Correlation Between Atlas Corp and Gold79 Mines
Can any of the company-specific risk be diversified away by investing in both Atlas Corp and Gold79 Mines 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 Gold79 Mines into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlas Corp and Gold79 Mines, you can compare the effects of market volatilities on Atlas Corp and Gold79 Mines 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 Gold79 Mines. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlas Corp and Gold79 Mines.
Diversification Opportunities for Atlas Corp and Gold79 Mines
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Atlas and Gold79 is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Atlas Corp and Gold79 Mines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold79 Mines 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 Gold79 Mines. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold79 Mines has no effect on the direction of Atlas Corp i.e., Atlas Corp and Gold79 Mines go up and down completely randomly.
Pair Corralation between Atlas Corp and Gold79 Mines
Assuming the 90 days horizon Atlas Corp is expected to generate 0.11 times more return on investment than Gold79 Mines. However, Atlas Corp is 9.27 times less risky than Gold79 Mines. It trades about 0.07 of its potential returns per unit of risk. Gold79 Mines is currently generating about -0.14 per unit of risk. If you would invest 2,495 in Atlas Corp on August 26, 2024 and sell it today you would earn a total of 15.00 from holding Atlas Corp or generate 0.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atlas Corp vs. Gold79 Mines
Performance |
| Timeline |
| Atlas Corp |
| Gold79 Mines |
Atlas Corp and Gold79 Mines Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlas Corp and Gold79 Mines
The main advantage of trading using opposite Atlas Corp and Gold79 Mines positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlas Corp position performs unexpectedly, Gold79 Mines 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 Gold79 Mines will offset losses from the drop in Gold79 Mines' long position.| Atlas Corp vs. Old Dominion Freight | Atlas Corp vs. ArcBest Corp | Atlas Corp vs. Werner Enterprises | Atlas Corp vs. Knight Transportation |
| Gold79 Mines vs. Arctic Star Exploration | Gold79 Mines vs. American Clean Resources | Gold79 Mines vs. Arras Minerals Corp | Gold79 Mines vs. American Creek Resources |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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