Correlation Between Atlas Corp and Binah Capital
Can any of the company-specific risk be diversified away by investing in both Atlas Corp and Binah Capital 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 Corp and Binah Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlas Corp and Binah Capital Group,, you can compare the effects of market volatilities on Atlas Corp and Binah Capital 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 Corp with a short position of Binah Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlas Corp and Binah Capital.
Diversification Opportunities for Atlas Corp and Binah Capital
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Atlas and Binah is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Atlas Corp and Binah Capital Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Binah Capital Group, and Atlas Corp 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 Corp are associated (or correlated) with Binah Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Binah Capital Group, has no effect on the direction of Atlas Corp i.e., Atlas Corp and Binah Capital go up and down completely randomly.
Pair Corralation between Atlas Corp and Binah Capital
Assuming the 90 days trading horizon Atlas Corp is expected to generate 124.11 times less return on investment than Binah Capital. But when comparing it to its historical volatility, Atlas Corp is 63.43 times less risky than Binah Capital. It trades about 0.13 of its potential returns per unit of risk. Binah Capital Group, is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 3.40 in Binah Capital Group, on August 27, 2024 and sell it today you would earn a total of 3.59 from holding Binah Capital Group, or generate 105.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 85.71% |
| Values | Daily Returns |
Atlas Corp vs. Binah Capital Group,
Performance |
| Timeline |
| Atlas Corp |
| Binah Capital Group, |
Atlas Corp and Binah Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlas Corp and Binah Capital
The main advantage of trading using opposite Atlas Corp and Binah Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlas Corp position performs unexpectedly, Binah Capital 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 Binah Capital will offset losses from the drop in Binah Capital's long position.The idea behind Atlas Corp and Binah Capital Group, 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.| Binah Capital vs. Fomento Economico Mexicano | Binah Capital vs. Diageo PLC ADR | Binah Capital vs. Sweetgreen | Binah Capital vs. RCI Hospitality Holdings |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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