Correlation Between Atlas Copco and SALTX TECHNOLOGY
Can any of the company-specific risk be diversified away by investing in both Atlas Copco and SALTX TECHNOLOGY 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 Atlas Copco and SALTX TECHNOLOGY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlas Copco A and SALTX TECHNOLOGY HLDG, you can compare the effects of market volatilities on Atlas Copco and SALTX TECHNOLOGY 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 Atlas Copco with a short position of SALTX TECHNOLOGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlas Copco and SALTX TECHNOLOGY.
Diversification Opportunities for Atlas Copco and SALTX TECHNOLOGY
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Atlas and SALTX is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Atlas Copco A and SALTX TECHNOLOGY HLDG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SALTX TECHNOLOGY HLDG and Atlas Copco 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 Atlas Copco A are associated (or correlated) with SALTX TECHNOLOGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SALTX TECHNOLOGY HLDG has no effect on the direction of Atlas Copco i.e., Atlas Copco and SALTX TECHNOLOGY go up and down completely randomly.
Pair Corralation between Atlas Copco and SALTX TECHNOLOGY
Assuming the 90 days horizon Atlas Copco A is expected to generate 0.32 times more return on investment than SALTX TECHNOLOGY. However, Atlas Copco A is 3.13 times less risky than SALTX TECHNOLOGY. It trades about -0.05 of its potential returns per unit of risk. SALTX TECHNOLOGY HLDG is currently generating about -0.15 per unit of risk. If you would invest 1,460 in Atlas Copco A on September 28, 2024 and sell it today you would lose (20.00) from holding Atlas Copco A or give up 1.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atlas Copco A vs. SALTX TECHNOLOGY HLDG
Performance |
| Timeline |
| Atlas Copco A |
| SALTX TECHNOLOGY HLDG |
Atlas Copco and SALTX TECHNOLOGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlas Copco and SALTX TECHNOLOGY
The main advantage of trading using opposite Atlas Copco and SALTX TECHNOLOGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlas Copco position performs unexpectedly, SALTX TECHNOLOGY 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 SALTX TECHNOLOGY will offset losses from the drop in SALTX TECHNOLOGY's long position.| Atlas Copco vs. SIEMENS AG SP | Atlas Copco vs. Siemens Aktiengesellschaft | Atlas Copco vs. Schneider Electric SE | Atlas Copco vs. RATIONAL Aktiengesellschaft |
| SALTX TECHNOLOGY vs. Jupiter Fund Management | SALTX TECHNOLOGY vs. Perdoceo Education | SALTX TECHNOLOGY vs. CSSC Offshore Marine | SALTX TECHNOLOGY vs. SIEM OFFSHORE NEW |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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