Correlation Between Amdocs and Apptech Corp

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

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

Diversification Opportunities for Amdocs and Apptech Corp

-0.49

Correlation Coefficient

Amdocs  Apptech Corp

Very good diversification

The 3 months correlation between Amdocs and Apptech is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Amdocs and Apptech Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apptech Corp and Amdocs 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 Amdocs are associated (or correlated) with Apptech Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apptech Corp has no effect on the direction of Amdocs i.e., Amdocs and Apptech Corp go up and down completely randomly.

Pair Corralation between Amdocs and Apptech Corp

Considering the 90-day investment horizon Amdocs is expected to generate 20.68 times less return on investment than Apptech Corp. But when comparing it to its historical volatility, Amdocs is 28.6 times less risky than Apptech Corp. It trades about 0.11 of its potential returns per unit of risk. Apptech Corp is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  42.00  in Apptech Corp on April 22, 2025 and sell it today you would lose (12.00) from holding Apptech Corp or give up 28.57% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	51.61%
Values	Daily Returns

Amdocs  vs.  Apptech Corp

Amdocs

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Amdocs are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Amdocs may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Apptech Corp

Risk-Adjusted Performance

Modest

Over the last 90 days Apptech Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly abnormal fundamental indicators, Apptech Corp showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Amdocs and Apptech Corp

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

The idea behind Amdocs and Apptech 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.