Correlation Between Apple and INDUSTRIAL MINERALS

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

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

Diversification Opportunities for Apple and INDUSTRIAL MINERALS

0.41

Correlation Coefficient

Apple  INDUSTRIAL MINERALS

Very weak diversification

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

Pair Corralation between Apple and INDUSTRIAL MINERALS

Assuming the 90 days trading horizon Apple is expected to generate 5.1 times less return on investment than INDUSTRIAL MINERALS. But when comparing it to its historical volatility, Apple Inc is 3.37 times less risky than INDUSTRIAL MINERALS. It trades about 0.02 of its potential returns per unit of risk. INDUSTRIAL MINERALS LTD is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  8.00  in INDUSTRIAL MINERALS LTD on April 23, 2025 and sell it today you would lose (0.05) from holding INDUSTRIAL MINERALS LTD or give up 0.62% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Apple Inc  vs.  INDUSTRIAL MINERALS LTD

Apple Inc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental indicators, Apple is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

INDUSTRIAL MINERALS LTD

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in INDUSTRIAL MINERALS LTD are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, INDUSTRIAL MINERALS may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with Apple and INDUSTRIAL MINERALS

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

The idea behind Apple Inc and INDUSTRIAL MINERALS LTD 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.