Correlation Between Telecom Argentina and Apple

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

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

Diversification Opportunities for Telecom Argentina and Apple

0.02

Correlation Coefficient

Telecom Argentina  Apple

Significant diversification

The 3 months correlation between Telecom and Apple is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Telecom Argentina and Apple Inc DRC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc DRC and Telecom Argentina 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 Telecom Argentina are associated (or correlated) with Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc DRC has no effect on the direction of Telecom Argentina i.e., Telecom Argentina and Apple go up and down completely randomly.

Pair Corralation between Telecom Argentina and Apple

Assuming the 90 days trading horizon Telecom Argentina is expected to generate 23.28 times less return on investment than Apple. In addition to that, Telecom Argentina is 1.32 times more volatile than Apple Inc DRC. It trades about 0.01 of its total potential returns per unit of risk. Apple Inc DRC is currently generating about 0.16 per unit of volatility. If you would invest  1,157,500  in Apple Inc DRC on April 22, 2025 and sell it today you would earn a total of  210,000  from holding Apple Inc DRC or generate 18.14% return on investment over 90 days.

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

Telecom Argentina  vs.  Apple Inc DRC

Telecom Argentina

Risk-Adjusted Performance

Very Weak

Over the last 90 days Telecom Argentina has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, Telecom Argentina is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Apple Inc DRC

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Apple Inc DRC are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Apple sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Telecom Argentina and Apple

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

The idea behind Telecom Argentina and Apple Inc DRC 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..