Correlation Between Atok Big and Metro Retail
Can any of the company-specific risk be diversified away by investing in both Atok Big and Metro Retail 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 Atok Big and Metro Retail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atok Big Wedge and Metro Retail Stores, you can compare the effects of market volatilities on Atok Big and Metro Retail 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 Atok Big with a short position of Metro Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atok Big and Metro Retail.
Diversification Opportunities for Atok Big and Metro Retail
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Atok and Metro is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Atok Big Wedge and Metro Retail Stores in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro Retail Stores and Atok Big 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 Atok Big Wedge are associated (or correlated) with Metro Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro Retail Stores has no effect on the direction of Atok Big i.e., Atok Big and Metro Retail go up and down completely randomly.
Pair Corralation between Atok Big and Metro Retail
Assuming the 90 days trading horizon Atok Big Wedge is expected to under-perform the Metro Retail. In addition to that, Atok Big is 3.96 times more volatile than Metro Retail Stores. It trades about -0.08 of its total potential returns per unit of risk. Metro Retail Stores is currently generating about 0.01 per unit of volatility. If you would invest 120.00 in Metro Retail Stores on September 12, 2024 and sell it today you would earn a total of 0.00 from holding Metro Retail Stores or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 80.95% |
| Values | Daily Returns |
Atok Big Wedge vs. Metro Retail Stores
Performance |
| Timeline |
| Atok Big Wedge |
| Metro Retail Stores |
Atok Big and Metro Retail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atok Big and Metro Retail
The main advantage of trading using opposite Atok Big and Metro Retail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atok Big position performs unexpectedly, Metro Retail 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 Metro Retail will offset losses from the drop in Metro Retail's long position.| Atok Big vs. House of Investments | Atok Big vs. Top Frontier Investment | Atok Big vs. Century Pacific Food | Atok Big vs. STI Education Systems |
| Metro Retail vs. Philex Mining Corp | Metro Retail vs. Globe Telecom | Metro Retail vs. Atlas Consolidated Mining | Metro Retail vs. Allhome 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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