Correlation Between ATLAND SA and BJs Wholesale
Can any of the company-specific risk be diversified away by investing in both ATLAND SA and BJs Wholesale 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 ATLAND SA and BJs Wholesale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATLAND SA INH and BJs Wholesale Club, you can compare the effects of market volatilities on ATLAND SA and BJs Wholesale 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 ATLAND SA with a short position of BJs Wholesale. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATLAND SA and BJs Wholesale.
Diversification Opportunities for ATLAND SA and BJs Wholesale
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ATLAND and BJs is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding ATLAND SA INH and BJs Wholesale Club in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BJs Wholesale Club and ATLAND SA 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 ATLAND SA INH are associated (or correlated) with BJs Wholesale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BJs Wholesale Club has no effect on the direction of ATLAND SA i.e., ATLAND SA and BJs Wholesale go up and down completely randomly.
Pair Corralation between ATLAND SA and BJs Wholesale
Assuming the 90 days horizon ATLAND SA is expected to generate 1.05 times less return on investment than BJs Wholesale. But when comparing it to its historical volatility, ATLAND SA INH is 1.35 times less risky than BJs Wholesale. It trades about 0.1 of its potential returns per unit of risk. BJs Wholesale Club is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 8,850 in BJs Wholesale Club on October 25, 2024 and sell it today you would earn a total of 200.00 from holding BJs Wholesale Club or generate 2.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
ATLAND SA INH vs. BJs Wholesale Club
Performance |
| Timeline |
| ATLAND SA INH |
| BJs Wholesale Club |
ATLAND SA and BJs Wholesale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATLAND SA and BJs Wholesale
The main advantage of trading using opposite ATLAND SA and BJs Wholesale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATLAND SA position performs unexpectedly, BJs Wholesale 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 BJs Wholesale will offset losses from the drop in BJs Wholesale's long position.| ATLAND SA vs. Nufarm Limited | ATLAND SA vs. Tencent Music Entertainment | ATLAND SA vs. ZINC MEDIA GR | ATLAND SA vs. Australian Agricultural |
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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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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