Correlation Between Atlantic American and Marfrig Global
Can any of the company-specific risk be diversified away by investing in both Atlantic American and Marfrig Global 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 Atlantic American and Marfrig Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlantic American and Marfrig Global Foods, you can compare the effects of market volatilities on Atlantic American and Marfrig Global 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 Atlantic American with a short position of Marfrig Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlantic American and Marfrig Global.
Diversification Opportunities for Atlantic American and Marfrig Global
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Atlantic and Marfrig is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Atlantic American and Marfrig Global Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marfrig Global Foods and Atlantic American 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 Atlantic American are associated (or correlated) with Marfrig Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marfrig Global Foods has no effect on the direction of Atlantic American i.e., Atlantic American and Marfrig Global go up and down completely randomly.
Pair Corralation between Atlantic American and Marfrig Global
Given the investment horizon of 90 days Atlantic American is expected to under-perform the Marfrig Global. In addition to that, Atlantic American is 1.0 times more volatile than Marfrig Global Foods. It trades about -0.02 of its total potential returns per unit of risk. Marfrig Global Foods is currently generating about 0.06 per unit of volatility. If you would invest 135.00 in Marfrig Global Foods on December 7, 2024 and sell it today you would earn a total of 130.00 from holding Marfrig Global Foods or generate 96.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Atlantic American vs. Marfrig Global Foods
Performance |
| Timeline |
| Atlantic American |
| Marfrig Global Foods |
Atlantic American and Marfrig Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlantic American and Marfrig Global
The main advantage of trading using opposite Atlantic American and Marfrig Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlantic American position performs unexpectedly, Marfrig Global 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 Marfrig Global will offset losses from the drop in Marfrig Global's long position.| Atlantic American vs. CNO Financial Group | Atlantic American vs. MetLife Preferred Stock | Atlantic American vs. FG Annuities Life | Atlantic American vs. Prudential PLC ADR |
| Marfrig Global vs. BRF SA ADR | Marfrig Global vs. Pilgrims Pride Corp | Marfrig Global vs. John B Sanfilippo | Marfrig Global vs. Seneca Foods Corp |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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