Correlation Between Atrium Mortgage and Scandium Canada
Can any of the company-specific risk be diversified away by investing in both Atrium Mortgage and Scandium Canada 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 Scandium Canada 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 Scandium Canada, you can compare the effects of market volatilities on Atrium Mortgage and Scandium Canada 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 Scandium Canada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atrium Mortgage and Scandium Canada.
Diversification Opportunities for Atrium Mortgage and Scandium Canada
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Atrium and Scandium is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Atrium Mortgage Investment and Scandium Canada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scandium Canada 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 Scandium Canada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scandium Canada has no effect on the direction of Atrium Mortgage i.e., Atrium Mortgage and Scandium Canada go up and down completely randomly.
Pair Corralation between Atrium Mortgage and Scandium Canada
Assuming the 90 days horizon Atrium Mortgage is expected to generate 91.49 times less return on investment than Scandium Canada. But when comparing it to its historical volatility, Atrium Mortgage Investment is 12.34 times less risky than Scandium Canada. It trades about 0.02 of its potential returns per unit of risk. Scandium Canada is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1.50 in Scandium Canada on October 31, 2024 and sell it today you would earn a total of 0.50 from holding Scandium Canada or generate 33.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atrium Mortgage Investment vs. Scandium Canada
Performance |
| Timeline |
| Atrium Mortgage Inve |
| Scandium Canada |
Atrium Mortgage and Scandium Canada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atrium Mortgage and Scandium Canada
The main advantage of trading using opposite Atrium Mortgage and Scandium Canada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atrium Mortgage position performs unexpectedly, Scandium Canada 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 Scandium Canada will offset losses from the drop in Scandium Canada'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 |
| Scandium Canada vs. Royal Bank of | Scandium Canada vs. Canadian Imperial Bank | Scandium Canada vs. Broadcom | Scandium Canada vs. North American Financial |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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