Correlation Between Apollo Micro and JSW Holdings

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

By analyzing existing cross correlation between Apollo Micro Systems and JSW Holdings Limited, you can compare the effects of market volatilities on Apollo Micro and JSW Holdings 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 Micro with a short position of JSW Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Apollo Micro and JSW Holdings.

Diversification Opportunities for Apollo Micro and JSW Holdings

-0.74

Correlation Coefficient

Apollo Micro  JSW Holdings

Pay attention - limited upside

The 3 months correlation between Apollo and JSW is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Apollo Micro Systems and JSW Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JSW Holdings Limited and Apollo Micro 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 Micro Systems are associated (or correlated) with JSW Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JSW Holdings Limited has no effect on the direction of Apollo Micro i.e., Apollo Micro and JSW Holdings go up and down completely randomly.

Pair Corralation between Apollo Micro and JSW Holdings

Assuming the 90 days trading horizon Apollo Micro Systems is expected to generate 1.72 times more return on investment than JSW Holdings. However, Apollo Micro is 1.72 times more volatile than JSW Holdings Limited. It trades about 0.24 of its potential returns per unit of risk. JSW Holdings Limited is currently generating about -0.05 per unit of risk. If you would invest  10,815  in Apollo Micro Systems on April 7, 2025 and sell it today you would earn a total of  8,373  from holding Apollo Micro Systems or generate 77.42% return on investment over 90 days.

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

Apollo Micro Systems  vs.  JSW Holdings Limited

Apollo Micro Systems

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Apollo Micro Systems are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain essential indicators, Apollo Micro sustained solid returns over the last few months and may actually be approaching a breakup point.

JSW Holdings Limited

Risk-Adjusted Performance

Very Weak

Over the last 90 days JSW Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with Apollo Micro and JSW Holdings

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

The idea behind Apollo Micro Systems and JSW Holdings Limited 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.