Correlation Between Apollo Senior and BNY Mellon

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

By analyzing existing cross correlation between Apollo Senior Floating and BNY Mellon High, you can compare the effects of market volatilities on Apollo Senior and BNY Mellon 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 Senior with a short position of BNY Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Senior and BNY Mellon.

Diversification Opportunities for Apollo Senior and BNY Mellon

0.76

Correlation Coefficient

Apollo Senior  BNY Mellon

Poor diversification

The 3 months correlation between Apollo and BNY is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Senior Floating and BNY Mellon High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BNY Mellon High and Apollo Senior 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 Senior Floating are associated (or correlated) with BNY Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BNY Mellon High has no effect on the direction of Apollo Senior i.e., Apollo Senior and BNY Mellon go up and down completely randomly.

Pair Corralation between Apollo Senior and BNY Mellon

If you would invest  250.00  in BNY Mellon High on August 31, 2024 and sell it today you would earn a total of  15.00  from holding BNY Mellon High or generate 6.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	1.56%
Values	Daily Returns

Apollo Senior Floating  vs.  BNY Mellon High

Apollo Senior Floating

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Apollo Senior Floating has generated negative risk-adjusted returns adding no value to fund investors. In spite of comparatively stable technical and fundamental indicators, Apollo Senior is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

BNY Mellon High

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in BNY Mellon High are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical indicators, BNY Mellon is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Apollo Senior and BNY Mellon

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

The idea behind Apollo Senior Floating and BNY Mellon High 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.