Correlation Between Spencers Retail and Apollo Micro

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

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

Diversification Opportunities for Spencers Retail and Apollo Micro

-0.42

Correlation Coefficient

Spencers Retail  Apollo Micro

Very good diversification

The 3 months correlation between Spencers and Apollo is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Spencers Retail Limited and Apollo Micro Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apollo Micro Systems and Spencers Retail 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 Spencers Retail Limited are associated (or correlated) with Apollo Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apollo Micro Systems has no effect on the direction of Spencers Retail i.e., Spencers Retail and Apollo Micro go up and down completely randomly.

Pair Corralation between Spencers Retail and Apollo Micro

Assuming the 90 days trading horizon Spencers Retail Limited is expected to under-perform the Apollo Micro. But the stock apears to be less risky and, when comparing its historical volatility, Spencers Retail Limited is 2.07 times less risky than Apollo Micro. The stock trades about -0.08 of its potential returns per unit of risk. The Apollo Micro Systems is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  11,640  in Apollo Micro Systems on April 24, 2025 and sell it today you would earn a total of  6,741  from holding Apollo Micro Systems or generate 57.91% return on investment over 90 days.

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

Spencers Retail Limited  vs.  Apollo Micro Systems

Spencers Retail

Risk-Adjusted Performance

Very Weak

Over the last 90 days Spencers Retail Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's technical and fundamental indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Apollo Micro Systems

Risk-Adjusted Performance

Good

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

Pair Trading with Spencers Retail and Apollo Micro

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

The idea behind Spencers Retail Limited and Apollo Micro Systems 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.