Correlation Between Atlantic American and Nextplat Corp
Can any of the company-specific risk be diversified away by investing in both Atlantic American and Nextplat Corp 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 Nextplat Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlantic American and Nextplat Corp, you can compare the effects of market volatilities on Atlantic American and Nextplat Corp 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 Nextplat Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlantic American and Nextplat Corp.
Diversification Opportunities for Atlantic American and Nextplat Corp
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Atlantic and Nextplat is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Atlantic American and Nextplat Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nextplat Corp 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 Nextplat Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nextplat Corp has no effect on the direction of Atlantic American i.e., Atlantic American and Nextplat Corp go up and down completely randomly.
Pair Corralation between Atlantic American and Nextplat Corp
Given the investment horizon of 90 days Atlantic American is expected to under-perform the Nextplat Corp. But the stock apears to be less risky and, when comparing its historical volatility, Atlantic American is 1.55 times less risky than Nextplat Corp. The stock trades about -0.02 of its potential returns per unit of risk. The Nextplat Corp is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 162.00 in Nextplat Corp on August 23, 2024 and sell it today you would lose (72.00) from holding Nextplat Corp or give up 44.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atlantic American vs. Nextplat Corp
Performance |
| Timeline |
| Atlantic American |
| Nextplat Corp |
Atlantic American and Nextplat Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlantic American and Nextplat Corp
The main advantage of trading using opposite Atlantic American and Nextplat Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlantic American position performs unexpectedly, Nextplat Corp 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 Nextplat Corp will offset losses from the drop in Nextplat Corp'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 Public Limited |
| Nextplat Corp vs. RenoWorks Software | Nextplat Corp vs. LifeSpeak | Nextplat Corp vs. 01 Communique Laboratory | Nextplat Corp vs. Where Food Comes |
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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