Correlation Between Atlas Insurance and Soneri Bank
Can any of the company-specific risk be diversified away by investing in both Atlas Insurance and Soneri Bank 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 Soneri Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlas Insurance and Soneri Bank, you can compare the effects of market volatilities on Atlas Insurance and Soneri Bank 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 Soneri Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlas Insurance and Soneri Bank.
Diversification Opportunities for Atlas Insurance and Soneri Bank
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Atlas and Soneri is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Atlas Insurance and Soneri Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Soneri Bank 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 Soneri Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Soneri Bank has no effect on the direction of Atlas Insurance i.e., Atlas Insurance and Soneri Bank go up and down completely randomly.
Pair Corralation between Atlas Insurance and Soneri Bank
Assuming the 90 days trading horizon Atlas Insurance is expected to generate 0.69 times more return on investment than Soneri Bank. However, Atlas Insurance is 1.45 times less risky than Soneri Bank. It trades about 0.46 of its potential returns per unit of risk. Soneri Bank is currently generating about 0.3 per unit of risk. If you would invest 4,975 in Atlas Insurance on September 14, 2024 and sell it today you would earn a total of 1,125 from holding Atlas Insurance or generate 22.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atlas Insurance vs. Soneri Bank
Performance |
| Timeline |
| Atlas Insurance |
| Soneri Bank |
Atlas Insurance and Soneri Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlas Insurance and Soneri Bank
The main advantage of trading using opposite Atlas Insurance and Soneri Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlas Insurance position performs unexpectedly, Soneri Bank 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 Soneri Bank will offset losses from the drop in Soneri Bank's long position.| Atlas Insurance vs. Masood Textile Mills | Atlas Insurance vs. Fauji Foods | Atlas Insurance vs. KSB Pumps | Atlas Insurance vs. Mari Petroleum |
| Soneri Bank vs. Crescent Steel Allied | Soneri Bank vs. Dost Steels | Soneri Bank vs. Pakistan Aluminium Beverage | Soneri Bank vs. Matco 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |