Correlation Between Apple and Stallion Discoveries

Can any of the company-specific risk be diversified away by investing in both Apple and Stallion Discoveries 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 Stallion Discoveries into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Apple Inc and Stallion Discoveries Corp, you can compare the effects of market volatilities on Apple and Stallion Discoveries 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 Stallion Discoveries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apple and Stallion Discoveries.

Diversification Opportunities for Apple and Stallion Discoveries

0.62

Correlation Coefficient

Apple  Stallion Discoveries

Poor diversification

The 3 months correlation between Apple and Stallion is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Apple Inc and Stallion Discoveries Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stallion Discoveries Corp 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 Stallion Discoveries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stallion Discoveries Corp has no effect on the direction of Apple i.e., Apple and Stallion Discoveries go up and down completely randomly.

Pair Corralation between Apple and Stallion Discoveries

Given the investment horizon of 90 days Apple is expected to generate 5.39 times less return on investment than Stallion Discoveries. But when comparing it to its historical volatility, Apple Inc is 4.0 times less risky than Stallion Discoveries. It trades about 0.17 of its potential returns per unit of risk. Stallion Discoveries Corp is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest  15.00  in Stallion Discoveries Corp on August 19, 2025 and sell it today you would earn a total of  16.00  from holding Stallion Discoveries Corp or generate 106.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.46%
Values	Daily Returns

Apple Inc  vs.  Stallion Discoveries Corp

Apple Inc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Apple disclosed solid returns over the last few months and may actually be approaching a breakup point.

Stallion Discoveries Corp

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Stallion Discoveries Corp are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Stallion Discoveries reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Apple and Stallion Discoveries

The main advantage of trading using opposite Apple and Stallion Discoveries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Apple position performs unexpectedly, Stallion Discoveries 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 Stallion Discoveries will offset losses from the drop in Stallion Discoveries' long position.

The idea behind Apple Inc and Stallion Discoveries Corp 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.