Correlation Between AP Møller and Fiserv

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

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

Diversification Opportunities for AP Møller and Fiserv

-0.57

Correlation Coefficient

AP Møller  Fiserv

Excellent diversification

The 3 months correlation between DP4B and Fiserv is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding AP Mller and Fiserv Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fiserv Inc and AP Møller 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 AP Mller are associated (or correlated) with Fiserv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fiserv Inc has no effect on the direction of AP Møller i.e., AP Møller and Fiserv go up and down completely randomly.

Pair Corralation between AP Møller and Fiserv

Assuming the 90 days trading horizon AP Mller is expected to generate 0.92 times more return on investment than Fiserv. However, AP Mller is 1.08 times less risky than Fiserv. It trades about 0.11 of its potential returns per unit of risk. Fiserv Inc is currently generating about -0.05 per unit of risk. If you would invest  148,350  in AP Mller on April 24, 2025 and sell it today you would earn a total of  24,550  from holding AP Mller or generate 16.55% return on investment over 90 days.

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

AP Mller   vs.  Fiserv Inc

AP Møller

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in AP Mller are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, AP Møller reported solid returns over the last few months and may actually be approaching a breakup point.

Fiserv Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Fiserv Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with AP Møller and Fiserv

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

The idea behind AP Mller and Fiserv Inc 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..