Correlation Between FIT Hon and Apple

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

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

Diversification Opportunities for FIT Hon and Apple

0.41

Correlation Coefficient

FIT Hon  Apple

Very weak diversification

The 3 months correlation between FIT and Apple is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding FIT Hon Teng and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and FIT Hon 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 FIT Hon Teng are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of FIT Hon i.e., FIT Hon and Apple go up and down completely randomly.

Pair Corralation between FIT Hon and Apple

Assuming the 90 days horizon FIT Hon Teng is expected to generate 5.59 times more return on investment than Apple. However, FIT Hon is 5.59 times more volatile than Apple Inc. It trades about 0.08 of its potential returns per unit of risk. Apple Inc is currently generating about 0.06 per unit of risk. If you would invest  28.00  in FIT Hon Teng on May 3, 2025 and sell it today you would earn a total of  6.00  from holding FIT Hon Teng or generate 21.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.41%
Values	Daily Returns

FIT Hon Teng  vs.  Apple Inc

FIT Hon Teng

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in FIT Hon Teng are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly abnormal technical and fundamental indicators, FIT Hon reported solid returns over the last few months and may actually be approaching a breakup point.

Apple Inc

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Apple is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with FIT Hon and Apple

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

The idea behind FIT Hon Teng and Apple Inc 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.