Correlation Between SupplyMe Capital and Apax Global

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

By analyzing existing cross correlation between SupplyMe Capital PLC and Apax Global Alpha, you can compare the effects of market volatilities on SupplyMe Capital and Apax Global 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 SupplyMe Capital with a short position of Apax Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of SupplyMe Capital and Apax Global.

Diversification Opportunities for SupplyMe Capital and Apax Global

-0.16

Correlation Coefficient

SupplyMe Capital  Apax Global

Good diversification

The 3 months correlation between SupplyMe and Apax is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding SupplyMe Capital PLC and Apax Global Alpha in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apax Global Alpha and SupplyMe Capital 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 SupplyMe Capital PLC are associated (or correlated) with Apax Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apax Global Alpha has no effect on the direction of SupplyMe Capital i.e., SupplyMe Capital and Apax Global go up and down completely randomly.

Pair Corralation between SupplyMe Capital and Apax Global

Assuming the 90 days trading horizon SupplyMe Capital PLC is expected to under-perform the Apax Global. In addition to that, SupplyMe Capital is 9.44 times more volatile than Apax Global Alpha. It trades about -0.07 of its total potential returns per unit of risk. Apax Global Alpha is currently generating about -0.01 per unit of volatility. If you would invest  14,065  in Apax Global Alpha on September 5, 2024 and sell it today you would lose (165.00) from holding Apax Global Alpha or give up 1.17% of portfolio value over 90 days.

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

SupplyMe Capital PLC  vs.  Apax Global Alpha

SupplyMe Capital PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SupplyMe Capital PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Apax Global Alpha

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with SupplyMe Capital and Apax Global

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

The idea behind SupplyMe Capital PLC and Apax Global Alpha 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.