Correlation Between Atlanticus Holdings and SoFi Technologies
Can any of the company-specific risk be diversified away by investing in both Atlanticus Holdings and SoFi Technologies 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 Atlanticus Holdings and SoFi Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlanticus Holdings and SoFi Technologies, you can compare the effects of market volatilities on Atlanticus Holdings and SoFi Technologies 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 Atlanticus Holdings with a short position of SoFi Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlanticus Holdings and SoFi Technologies.
Diversification Opportunities for Atlanticus Holdings and SoFi Technologies
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Atlanticus and SoFi is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Atlanticus Holdings and SoFi Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SoFi Technologies and Atlanticus Holdings 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 Atlanticus Holdings are associated (or correlated) with SoFi Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SoFi Technologies has no effect on the direction of Atlanticus Holdings i.e., Atlanticus Holdings and SoFi Technologies go up and down completely randomly.
Pair Corralation between Atlanticus Holdings and SoFi Technologies
Given the investment horizon of 90 days Atlanticus Holdings is expected to generate 0.92 times more return on investment than SoFi Technologies. However, Atlanticus Holdings is 1.09 times less risky than SoFi Technologies. It trades about 0.77 of its potential returns per unit of risk. SoFi Technologies is currently generating about 0.6 per unit of risk. If you would invest 3,719 in Atlanticus Holdings on September 1, 2024 and sell it today you would earn a total of 2,107 from holding Atlanticus Holdings or generate 56.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atlanticus Holdings vs. SoFi Technologies
Performance |
| Timeline |
| Atlanticus Holdings |
| SoFi Technologies |
Atlanticus Holdings and SoFi Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlanticus Holdings and SoFi Technologies
The main advantage of trading using opposite Atlanticus Holdings and SoFi Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlanticus Holdings position performs unexpectedly, SoFi Technologies 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 SoFi Technologies will offset losses from the drop in SoFi Technologies' long position.| Atlanticus Holdings vs. 360 Finance | Atlanticus Holdings vs. Lexinfintech Holdings | Atlanticus Holdings vs. Qudian Inc | Atlanticus Holdings vs. Enova International |
| SoFi Technologies vs. 360 Finance | SoFi Technologies vs. Atlanticus Holdings | SoFi Technologies vs. Qudian Inc | SoFi Technologies vs. Enova International |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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