Correlation Between Alton Sports and Atinum Investment
Can any of the company-specific risk be diversified away by investing in both Alton Sports and Atinum Investment 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 Alton Sports and Atinum Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alton Sports CoLtd and Atinum Investment Co, you can compare the effects of market volatilities on Alton Sports and Atinum Investment 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 Alton Sports with a short position of Atinum Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alton Sports and Atinum Investment.
Diversification Opportunities for Alton Sports and Atinum Investment
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alton and Atinum is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Alton Sports CoLtd and Atinum Investment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atinum Investment and Alton Sports 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 Alton Sports CoLtd are associated (or correlated) with Atinum Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atinum Investment has no effect on the direction of Alton Sports i.e., Alton Sports and Atinum Investment go up and down completely randomly.
Pair Corralation between Alton Sports and Atinum Investment
Assuming the 90 days trading horizon Alton Sports CoLtd is expected to generate 1.16 times more return on investment than Atinum Investment. However, Alton Sports is 1.16 times more volatile than Atinum Investment Co. It trades about 0.33 of its potential returns per unit of risk. Atinum Investment Co is currently generating about -0.61 per unit of risk. If you would invest 145,300 in Alton Sports CoLtd on November 5, 2024 and sell it today you would earn a total of 8,700 from holding Alton Sports CoLtd or generate 5.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alton Sports CoLtd vs. Atinum Investment Co
Performance |
| Timeline |
| Alton Sports CoLtd |
| Atinum Investment |
Alton Sports and Atinum Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alton Sports and Atinum Investment
The main advantage of trading using opposite Alton Sports and Atinum Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alton Sports position performs unexpectedly, Atinum Investment 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 Atinum Investment will offset losses from the drop in Atinum Investment's long position.| Alton Sports vs. KTB Investment Securities | Alton Sports vs. Sam Yang Foods | Alton Sports vs. Daol Investment Securities | Alton Sports vs. Woori Technology Investment |
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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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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