Correlation Between Atrium Mortgage and North American
Can any of the company-specific risk be diversified away by investing in both Atrium Mortgage and North American 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 Atrium Mortgage and North American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atrium Mortgage Investment and North American Construction, you can compare the effects of market volatilities on Atrium Mortgage and North American 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 Atrium Mortgage with a short position of North American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atrium Mortgage and North American.
Diversification Opportunities for Atrium Mortgage and North American
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Atrium and North is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Atrium Mortgage Investment and North American Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North American Const and Atrium Mortgage 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 Atrium Mortgage Investment are associated (or correlated) with North American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North American Const has no effect on the direction of Atrium Mortgage i.e., Atrium Mortgage and North American go up and down completely randomly.
Pair Corralation between Atrium Mortgage and North American
Assuming the 90 days horizon Atrium Mortgage Investment is expected to generate 0.8 times more return on investment than North American. However, Atrium Mortgage Investment is 1.26 times less risky than North American. It trades about -0.09 of its potential returns per unit of risk. North American Construction is currently generating about -0.43 per unit of risk. If you would invest 1,091 in Atrium Mortgage Investment on December 1, 2024 and sell it today you would lose (20.00) from holding Atrium Mortgage Investment or give up 1.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atrium Mortgage Investment vs. North American Construction
Performance |
| Timeline |
| Atrium Mortgage Inve |
| North American Const |
Atrium Mortgage and North American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atrium Mortgage and North American
The main advantage of trading using opposite Atrium Mortgage and North American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atrium Mortgage position performs unexpectedly, North American 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 North American will offset losses from the drop in North American's long position.| Atrium Mortgage vs. Timbercreek Financial Corp | Atrium Mortgage vs. Firm Capital Mortgage | Atrium Mortgage vs. MCAN Mortgage | Atrium Mortgage vs. First National Financial |
| North American vs. PHX Energy Services | North American vs. CES Energy Solutions | North American vs. Total Energy Services | North American vs. Pason Systems |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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