Correlation Between AAON and Atlas Engineered
Can any of the company-specific risk be diversified away by investing in both AAON and Atlas Engineered 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 AAON and Atlas Engineered into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AAON Inc and Atlas Engineered Products, you can compare the effects of market volatilities on AAON and Atlas Engineered 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 AAON with a short position of Atlas Engineered. Check out your portfolio center. Please also check ongoing floating volatility patterns of AAON and Atlas Engineered.
Diversification Opportunities for AAON and Atlas Engineered
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AAON and Atlas is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding AAON Inc and Atlas Engineered Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlas Engineered Products and AAON 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 AAON Inc are associated (or correlated) with Atlas Engineered. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlas Engineered Products has no effect on the direction of AAON i.e., AAON and Atlas Engineered go up and down completely randomly.
Pair Corralation between AAON and Atlas Engineered
Given the investment horizon of 90 days AAON Inc is expected to generate 1.87 times more return on investment than Atlas Engineered. However, AAON is 1.87 times more volatile than Atlas Engineered Products. It trades about 0.23 of its potential returns per unit of risk. Atlas Engineered Products is currently generating about -0.28 per unit of risk. If you would invest 11,415 in AAON Inc on September 1, 2024 and sell it today you would earn a total of 2,219 from holding AAON Inc or generate 19.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AAON Inc vs. Atlas Engineered Products
Performance |
| Timeline |
| AAON Inc |
| Atlas Engineered Products |
AAON and Atlas Engineered Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AAON and Atlas Engineered
The main advantage of trading using opposite AAON and Atlas Engineered positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AAON position performs unexpectedly, Atlas Engineered 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 Atlas Engineered will offset losses from the drop in Atlas Engineered's long position.| AAON vs. Quanex Building Products | AAON vs. Gibraltar Industries | AAON vs. Armstrong World Industries | AAON vs. Beacon Roofing Supply |
| Atlas Engineered vs. Travis Perkins PLC | Atlas Engineered vs. Antelope Enterprise Holdings | Atlas Engineered vs. Intelligent Living Application | Atlas Engineered vs. Beacon Roofing Supply |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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