Hello and welcome to CorrelatePro. Today we are going to add a portfolio and manage the stocks within that portfolio. Let's create one for technology. We'll start off by adding in AAPL. As you can see a node appears, and that node has the daily close. Let's add in TSLA. This edge indicates the correlation between the two. It's not super useful on its own but once we add in another stock we can start to compare how correlated two things are. So we can AAPL is about as correlated to TSLA as it is to GOOG this correlation is taken over the past year's return.
Now GOOG is a bit more correlated to TSLA than AAPL but it's not yet clear if that is worrying. Let's add in AMD. Now AAPL is about as correlated to AMD as it is to GOOG or TSLA. Let's focus on AMD. Wow. We can see that AMD is pretty closely correlated to GOOG and TSLA but not such much to AAPL. Alright, let's add in another. TWLO. We can see once again AAPL is kind of on its own, which means its a pretty solid addition to our portfolio. Returns in AAPL aren't really going to be affected by returns in the others.
Let's look at TWLO. We see the same kind of phenomenon here. What about TSLA? TSLA is pretty correlated to GOOG and AMD. We probably should not have these three in our portfolio. It's not a problem lets delete them. Let's leave GOOG in there. With Correlate Pro it's easy to make decisions like this because of how visually intuitive it is.