Correlation Between Atlas Insurance and Crescent Star
Can any of the company-specific risk be diversified away by investing in both Atlas Insurance and Crescent Star 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 Insurance and Crescent Star into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlas Insurance and Crescent Star Insurance, you can compare the effects of market volatilities on Atlas Insurance and Crescent Star 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 Insurance with a short position of Crescent Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlas Insurance and Crescent Star.
Diversification Opportunities for Atlas Insurance and Crescent Star
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Atlas and Crescent is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Atlas Insurance and Crescent Star Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crescent Star Insurance and Atlas Insurance 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 Insurance are associated (or correlated) with Crescent Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crescent Star Insurance has no effect on the direction of Atlas Insurance i.e., Atlas Insurance and Crescent Star go up and down completely randomly.
Pair Corralation between Atlas Insurance and Crescent Star
Assuming the 90 days trading horizon Atlas Insurance is expected to generate 1.09 times less return on investment than Crescent Star. But when comparing it to its historical volatility, Atlas Insurance is 2.22 times less risky than Crescent Star. It trades about 0.11 of its potential returns per unit of risk. Crescent Star Insurance is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 143.00 in Crescent Star Insurance on October 30, 2024 and sell it today you would earn a total of 141.00 from holding Crescent Star Insurance or generate 98.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 86.22% |
| Values | Daily Returns |
Atlas Insurance vs. Crescent Star Insurance
Performance |
| Timeline |
| Atlas Insurance |
| Crescent Star Insurance |
Atlas Insurance and Crescent Star Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlas Insurance and Crescent Star
The main advantage of trading using opposite Atlas Insurance and Crescent Star positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlas Insurance position performs unexpectedly, Crescent Star 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 Crescent Star will offset losses from the drop in Crescent Star's long position.| Atlas Insurance vs. Nimir Industrial Chemical | Atlas Insurance vs. Fauji Foods | Atlas Insurance vs. Unilever Pakistan Foods | Atlas Insurance vs. Invest Capital Investment |
| Crescent Star vs. Matco Foods | Crescent Star vs. Wah Nobel Chemicals | Crescent Star vs. Sardar Chemical Industries | Crescent Star vs. Fauji Foods |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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