Correlation Between Attica Publications and Profile Systems
Can any of the company-specific risk be diversified away by investing in both Attica Publications and Profile Systems 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 Attica Publications and Profile Systems into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Attica Publications SA and Profile Systems Software, you can compare the effects of market volatilities on Attica Publications and Profile Systems 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 Attica Publications with a short position of Profile Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Attica Publications and Profile Systems.
Diversification Opportunities for Attica Publications and Profile Systems
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Attica and Profile is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Attica Publications SA and Profile Systems Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Profile Systems Software and Attica Publications 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 Attica Publications SA are associated (or correlated) with Profile Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Profile Systems Software has no effect on the direction of Attica Publications i.e., Attica Publications and Profile Systems go up and down completely randomly.
Pair Corralation between Attica Publications and Profile Systems
Assuming the 90 days trading horizon Attica Publications SA is expected to generate 2.52 times more return on investment than Profile Systems. However, Attica Publications is 2.52 times more volatile than Profile Systems Software. It trades about 0.05 of its potential returns per unit of risk. Profile Systems Software is currently generating about 0.02 per unit of risk. If you would invest 32.00 in Attica Publications SA on September 12, 2024 and sell it today you would earn a total of 11.00 from holding Attica Publications SA or generate 34.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 74.79% |
| Values | Daily Returns |
Attica Publications SA vs. Profile Systems Software
Performance |
| Timeline |
| Attica Publications |
| Profile Systems Software |
Attica Publications and Profile Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Attica Publications and Profile Systems
The main advantage of trading using opposite Attica Publications and Profile Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Attica Publications position performs unexpectedly, Profile Systems 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 Profile Systems will offset losses from the drop in Profile Systems' long position.The idea behind Attica Publications SA and Profile Systems Software 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.
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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