Correlation Between Apogee Enterprises and Interface

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

By analyzing existing cross correlation between Apogee Enterprises and Interface, you can compare the effects of market volatilities on Apogee Enterprises and Interface 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 Apogee Enterprises with a short position of Interface. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apogee Enterprises and Interface.

Diversification Opportunities for Apogee Enterprises and Interface

0.42

Correlation Coefficient

Apogee Enterprises  Interface

Very weak diversification

The 3 months correlation between Apogee and Interface is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Apogee Enterprises and Interface in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Interface and Apogee Enterprises 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 Apogee Enterprises are associated (or correlated) with Interface. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Interface has no effect on the direction of Apogee Enterprises i.e., Apogee Enterprises and Interface go up and down completely randomly.

Pair Corralation between Apogee Enterprises and Interface

Given the investment horizon of 90 days Apogee Enterprises is expected to generate 56.58 times less return on investment than Interface. But when comparing it to its historical volatility, Apogee Enterprises is 1.55 times less risky than Interface. It trades about 0.0 of its potential returns per unit of risk. Interface is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  2,092  in Interface on May 11, 2025 and sell it today you would earn a total of  395.00  from holding Interface or generate 18.88% return on investment over 90 days.

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

Apogee Enterprises  vs.  Interface

Apogee Enterprises

Risk-Adjusted Performance

Weakest

Over the last 90 days Apogee Enterprises has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Apogee Enterprises is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Interface

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Interface are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting essential indicators, Interface exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Apogee Enterprises and Interface

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

The idea behind Apogee Enterprises and Interface 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.