Correlation Between Apollo Global and Affiliated Managers

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

By analyzing existing cross correlation between Apollo Global Management and Affiliated Managers Group, you can compare the effects of market volatilities on Apollo Global and Affiliated Managers 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 Apollo Global with a short position of Affiliated Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Global and Affiliated Managers.

Diversification Opportunities for Apollo Global and Affiliated Managers

0.84

Correlation Coefficient

Apollo Global  Affiliated Managers

Very poor diversification

The 3 months correlation between Apollo and Affiliated is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Global Management and Affiliated Managers Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Affiliated Managers and Apollo Global 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 Apollo Global Management are associated (or correlated) with Affiliated Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Affiliated Managers has no effect on the direction of Apollo Global i.e., Apollo Global and Affiliated Managers go up and down completely randomly.

Pair Corralation between Apollo Global and Affiliated Managers

Considering the 90-day investment horizon Apollo Global is expected to generate 3.76 times less return on investment than Affiliated Managers. In addition to that, Apollo Global is 1.62 times more volatile than Affiliated Managers Group. It trades about 0.04 of its total potential returns per unit of risk. Affiliated Managers Group is currently generating about 0.22 per unit of volatility. If you would invest  17,259  in Affiliated Managers Group on May 4, 2025 and sell it today you would earn a total of  3,447  from holding Affiliated Managers Group or generate 19.97% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Apollo Global Management  vs.  Affiliated Managers Group

Apollo Global Management

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Apollo Global Management are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Apollo Global is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Affiliated Managers

Risk-Adjusted Performance

Solid

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

Pair Trading with Apollo Global and Affiliated Managers

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

The idea behind Apollo Global Management and Affiliated Managers Group 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.

Check out your portfolio center.

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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.