Correlation Between Apple and Socket Mobile

Can any of the company-specific risk be diversified away by investing in both Apple and Socket Mobile at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Apple and Socket Mobile into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Apple Inc and Socket Mobile, you can compare the effects of market volatilities on Apple and Socket Mobile and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Apple with a short position of Socket Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Socket Mobile.

Diversification Opportunities for Apple and Socket Mobile

-0.4

Correlation Coefficient

Apple  Socket Mobile

Very good diversification

The 3 months correlation between Apple and Socket is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Socket Mobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Socket Mobile and Apple is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Apple Inc are associated (or correlated) with Socket Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Socket Mobile has no effect on the direction of Apple i.e., Apple and Socket Mobile go up and down completely randomly.

Pair Corralation between Apple and Socket Mobile

Given the investment horizon of 90 days Apple Inc is expected to generate 0.5 times more return on investment than Socket Mobile. However, Apple Inc is 2.0 times less risky than Socket Mobile. It trades about 0.12 of its potential returns per unit of risk. Socket Mobile is currently generating about -0.04 per unit of risk. If you would invest  20,854  in Apple Inc on May 19, 2025 and sell it today you would earn a total of  2,305  from holding Apple Inc or generate 11.05% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Apple Inc  vs.  Socket Mobile

Apple Inc

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite unfluctuating basic indicators, Apple may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Socket Mobile

Risk-Adjusted Performance

Weakest

Over the last 90 days Socket Mobile has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's forward-looking signals remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with Apple and Socket Mobile

The main advantage of trading using opposite Apple and Socket Mobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Socket Mobile can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Socket Mobile will offset losses from the drop in Socket Mobile's long position.

The idea behind Apple Inc and Socket Mobile pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.