Correlation Between Argen X and Atenor SA
Can any of the company-specific risk be diversified away by investing in both Argen X and Atenor SA 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 Argen X and Atenor SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Argen X and Atenor SA, you can compare the effects of market volatilities on Argen X and Atenor SA 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 Argen X with a short position of Atenor SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Argen X and Atenor SA.
Diversification Opportunities for Argen X and Atenor SA
Pay attention - limited upside
The 3 months correlation between Argen and Atenor is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Argen X and Atenor SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atenor SA and Argen X 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 Argen X are associated (or correlated) with Atenor SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atenor SA has no effect on the direction of Argen X i.e., Argen X and Atenor SA go up and down completely randomly.
Pair Corralation between Argen X and Atenor SA
Assuming the 90 days trading horizon Argen X is expected to generate 1.42 times more return on investment than Atenor SA. However, Argen X is 1.42 times more volatile than Atenor SA. It trades about 0.16 of its potential returns per unit of risk. Atenor SA is currently generating about -0.28 per unit of risk. If you would invest 55,160 in Argen X on September 2, 2024 and sell it today you would earn a total of 3,480 from holding Argen X or generate 6.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Argen X vs. Atenor SA
Performance |
| Timeline |
| Argen X |
| Atenor SA |
Argen X and Atenor SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Argen X and Atenor SA
The main advantage of trading using opposite Argen X and Atenor SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Argen X position performs unexpectedly, Atenor SA 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 Atenor SA will offset losses from the drop in Atenor SA's long position.The idea behind Argen X and Atenor SA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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