Correlation Between Atlas Corp and K92 Mining
Can any of the company-specific risk be diversified away by investing in both Atlas Corp and K92 Mining 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 K92 Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlas Corp and K92 Mining, you can compare the effects of market volatilities on Atlas Corp and K92 Mining 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 K92 Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlas Corp and K92 Mining.
Diversification Opportunities for Atlas Corp and K92 Mining
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Atlas and K92 is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Atlas Corp and K92 Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on K92 Mining 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 K92 Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of K92 Mining has no effect on the direction of Atlas Corp i.e., Atlas Corp and K92 Mining go up and down completely randomly.
Pair Corralation between Atlas Corp and K92 Mining
Assuming the 90 days horizon Atlas Corp is expected to generate 1.65 times less return on investment than K92 Mining. But when comparing it to its historical volatility, Atlas Corp is 5.23 times less risky than K92 Mining. It trades about 0.06 of its potential returns per unit of risk. K92 Mining is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 606.00 in K92 Mining on August 31, 2024 and sell it today you would earn a total of 38.00 from holding K92 Mining or generate 6.27% 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. K92 Mining
Performance |
| Timeline |
| Atlas Corp |
| K92 Mining |
Atlas Corp and K92 Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlas Corp and K92 Mining
The main advantage of trading using opposite Atlas Corp and K92 Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlas Corp position performs unexpectedly, K92 Mining 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 K92 Mining will offset losses from the drop in K92 Mining's long position.| Atlas Corp vs. Harrow Health 8625 | Atlas Corp vs. Babcock Wilcox Enterprises, | Atlas Corp vs. B Riley Financial | Atlas Corp vs. Oxford Lane Capital |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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