Correlation Between EPlay Digital and Apple

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

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

Diversification Opportunities for EPlay Digital and Apple

0.0

Correlation Coefficient

EPlay Digital  Apple

Pay attention - limited upside

The 3 months correlation between EPlay and Apple is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ePlay Digital and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc and EPlay Digital 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 ePlay Digital 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 EPlay Digital i.e., EPlay Digital and Apple go up and down completely randomly.

Pair Corralation between EPlay Digital and Apple

If you would invest  20,126  in Apple Inc on September 3, 2024 and sell it today you would earn a total of  2,309  from holding Apple Inc or generate 11.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.46%
Values	Daily Returns

ePlay Digital  vs.  Apple Inc

ePlay Digital

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ePlay Digital has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, EPlay Digital is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Apple Inc

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Apple may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with EPlay Digital and Apple

The main advantage of trading using opposite EPlay Digital and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EPlay Digital 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 ePlay Digital 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.

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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.