Correlation Between InfoBank and ATON
Can any of the company-specific risk be diversified away by investing in both InfoBank and ATON 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 InfoBank and ATON into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between InfoBank and ATON Inc, you can compare the effects of market volatilities on InfoBank and ATON 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 InfoBank with a short position of ATON. Check out your portfolio center. Please also check ongoing floating volatility patterns of InfoBank and ATON.
Diversification Opportunities for InfoBank and ATON
Weak diversification
The 3 months correlation between InfoBank and ATON is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding InfoBank and ATON Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATON Inc and InfoBank 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 InfoBank are associated (or correlated) with ATON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATON Inc has no effect on the direction of InfoBank i.e., InfoBank and ATON go up and down completely randomly.
Pair Corralation between InfoBank and ATON
Assuming the 90 days trading horizon InfoBank is expected to generate 1.7 times less return on investment than ATON. But when comparing it to its historical volatility, InfoBank is 1.56 times less risky than ATON. It trades about 0.15 of its potential returns per unit of risk. ATON Inc is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 416,000 in ATON Inc on September 3, 2024 and sell it today you would earn a total of 105,000 from holding ATON Inc or generate 25.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
InfoBank vs. ATON Inc
Performance |
| Timeline |
| InfoBank |
| ATON Inc |
InfoBank and ATON Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with InfoBank and ATON
The main advantage of trading using opposite InfoBank and ATON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if InfoBank position performs unexpectedly, ATON 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 ATON will offset losses from the drop in ATON's long position.| InfoBank vs. Korea Refract | InfoBank vs. Korea Refractories Co | InfoBank vs. Shinhan Inverse WTI | InfoBank vs. SAMYOUNG M Tek Co |
| ATON vs. Posco ICT | ATON vs. Devsisters corporation | ATON vs. Alchera | ATON vs. Nice Information Telecommunication |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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