Correlation Between Atlas Corp and Spanish Mountain
Can any of the company-specific risk be diversified away by investing in both Atlas Corp and Spanish Mountain 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 Spanish Mountain into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlas Corp and Spanish Mountain Gold, you can compare the effects of market volatilities on Atlas Corp and Spanish Mountain 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 Spanish Mountain. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlas Corp and Spanish Mountain.
Diversification Opportunities for Atlas Corp and Spanish Mountain
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Atlas and Spanish is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Atlas Corp and Spanish Mountain Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Spanish Mountain Gold 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 Spanish Mountain. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Spanish Mountain Gold has no effect on the direction of Atlas Corp i.e., Atlas Corp and Spanish Mountain go up and down completely randomly.
Pair Corralation between Atlas Corp and Spanish Mountain
Assuming the 90 days horizon Atlas Corp is expected to generate 1.89 times less return on investment than Spanish Mountain. But when comparing it to its historical volatility, Atlas Corp is 9.84 times less risky than Spanish Mountain. It trades about 0.07 of its potential returns per unit of risk. Spanish Mountain Gold is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Spanish Mountain Gold on September 3, 2024 and sell it today you would lose (5.00) from holding Spanish Mountain Gold or give up 38.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atlas Corp vs. Spanish Mountain Gold
Performance |
| Timeline |
| Atlas Corp |
| Spanish Mountain Gold |
Atlas Corp and Spanish Mountain Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlas Corp and Spanish Mountain
The main advantage of trading using opposite Atlas Corp and Spanish Mountain positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlas Corp position performs unexpectedly, Spanish Mountain 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 Spanish Mountain will offset losses from the drop in Spanish Mountain'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 |
| Spanish Mountain vs. Argo Gold | Spanish Mountain vs. Advance Gold Corp | Spanish Mountain vs. Angkor Resources Corp | Spanish Mountain vs. Minnova Corp |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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