Correlation Between Atinum Investment and LAKE MATERIALS
Can any of the company-specific risk be diversified away by investing in both Atinum Investment and LAKE MATERIALS 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 Atinum Investment and LAKE MATERIALS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atinum Investment Co and LAKE MATERIALS LTD, you can compare the effects of market volatilities on Atinum Investment and LAKE MATERIALS 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 Atinum Investment with a short position of LAKE MATERIALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atinum Investment and LAKE MATERIALS.
Diversification Opportunities for Atinum Investment and LAKE MATERIALS
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Atinum and LAKE is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Atinum Investment Co and LAKE MATERIALS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LAKE MATERIALS LTD and Atinum Investment 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 Atinum Investment Co are associated (or correlated) with LAKE MATERIALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LAKE MATERIALS LTD has no effect on the direction of Atinum Investment i.e., Atinum Investment and LAKE MATERIALS go up and down completely randomly.
Pair Corralation between Atinum Investment and LAKE MATERIALS
Assuming the 90 days trading horizon Atinum Investment Co is expected to generate 0.94 times more return on investment than LAKE MATERIALS. However, Atinum Investment Co is 1.06 times less risky than LAKE MATERIALS. It trades about -0.05 of its potential returns per unit of risk. LAKE MATERIALS LTD is currently generating about -0.08 per unit of risk. If you would invest 236,813 in Atinum Investment Co on October 26, 2024 and sell it today you would lose (27,813) from holding Atinum Investment Co or give up 11.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atinum Investment Co vs. LAKE MATERIALS LTD
Performance |
| Timeline |
| Atinum Investment |
| LAKE MATERIALS LTD |
Atinum Investment and LAKE MATERIALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atinum Investment and LAKE MATERIALS
The main advantage of trading using opposite Atinum Investment and LAKE MATERIALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atinum Investment position performs unexpectedly, LAKE MATERIALS 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 LAKE MATERIALS will offset losses from the drop in LAKE MATERIALS's long position.| Atinum Investment vs. Samsung Electronics Co | Atinum Investment vs. Samsung Electronics Co | Atinum Investment vs. SK Hynix | Atinum Investment vs. HMM Co |
| LAKE MATERIALS vs. Leaders Technology Investment | LAKE MATERIALS vs. Woori Technology Investment | LAKE MATERIALS vs. Hyundai Green Food | LAKE MATERIALS vs. Atinum Investment Co |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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