Correlation Between Hasbro and Apogee Enterprises

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Can any of the company-specific risk be diversified away by investing in both Hasbro and Apogee Enterprises 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 Hasbro and Apogee Enterprises into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hasbro Inc and Apogee Enterprises, you can compare the effects of market volatilities on Hasbro and Apogee Enterprises 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 Hasbro with a short position of Apogee Enterprises. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hasbro and Apogee Enterprises.

Diversification Opportunities for Hasbro and Apogee Enterprises

-0.6
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Hasbro and Apogee is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Hasbro Inc and Apogee Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apogee Enterprises and Hasbro 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 Hasbro Inc are associated (or correlated) with Apogee Enterprises. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apogee Enterprises has no effect on the direction of Hasbro i.e., Hasbro and Apogee Enterprises go up and down completely randomly.

Pair Corralation between Hasbro and Apogee Enterprises

Considering the 90-day investment horizon Hasbro Inc is expected to generate 1.3 times more return on investment than Apogee Enterprises. However, Hasbro is 1.3 times more volatile than Apogee Enterprises. It trades about 0.05 of its potential returns per unit of risk. Apogee Enterprises is currently generating about -0.23 per unit of risk. If you would invest  6,099  in Hasbro Inc on September 17, 2024 and sell it today you would earn a total of  77.00  from holding Hasbro Inc or generate 1.26% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Hasbro Inc  vs.  Apogee Enterprises

 Performance 
       Timeline  
Hasbro Inc 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Hasbro Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.
Apogee Enterprises 

Risk-Adjusted Performance

5 of 100

 
Weak
 
Strong
Modest
Compared to the overall equity markets, risk-adjusted returns on investments in Apogee Enterprises are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly weak basic indicators, Apogee Enterprises reported solid returns over the last few months and may actually be approaching a breakup point.

Hasbro and Apogee Enterprises Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Hasbro and Apogee Enterprises

The main advantage of trading using opposite Hasbro and Apogee Enterprises positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hasbro position performs unexpectedly, Apogee Enterprises 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 Apogee Enterprises will offset losses from the drop in Apogee Enterprises' long position.
The idea behind Hasbro Inc and Apogee Enterprises 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.

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