Correlation Between IBI Mutual and Apollo Power

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

By analyzing existing cross correlation between IBI Mutual Funds and Apollo Power, you can compare the effects of market volatilities on IBI Mutual and Apollo Power 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 IBI Mutual with a short position of Apollo Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of IBI Mutual and Apollo Power.

Diversification Opportunities for IBI Mutual and Apollo Power

0.54

Correlation Coefficient

IBI Mutual  Apollo Power

Very weak diversification

The 3 months correlation between IBI and Apollo is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding IBI Mutual Funds and Apollo Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Power and IBI Mutual 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 IBI Mutual Funds are associated (or correlated) with Apollo Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Power has no effect on the direction of IBI Mutual i.e., IBI Mutual and Apollo Power go up and down completely randomly.

Pair Corralation between IBI Mutual and Apollo Power

Assuming the 90 days trading horizon IBI Mutual is expected to generate 4.98 times less return on investment than Apollo Power. But when comparing it to its historical volatility, IBI Mutual Funds is 2.68 times less risky than Apollo Power. It trades about 0.11 of its potential returns per unit of risk. Apollo Power is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  25,320  in Apollo Power on April 24, 2025 and sell it today you would earn a total of  12,480  from holding Apollo Power or generate 49.29% return on investment over 90 days.

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

IBI Mutual Funds  vs.  Apollo Power

IBI Mutual Funds

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in IBI Mutual Funds are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak technical and fundamental indicators, IBI Mutual may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Apollo Power

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Apollo Power are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Apollo Power sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with IBI Mutual and Apollo Power

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

The idea behind IBI Mutual Funds and Apollo Power 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.