Correlation Between ATMA Participaes and Hewlett Packard
Can any of the company-specific risk be diversified away by investing in both ATMA Participaes and Hewlett Packard 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 ATMA Participaes and Hewlett Packard into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATMA Participaes SA and Hewlett Packard Co, you can compare the effects of market volatilities on ATMA Participaes and Hewlett Packard 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 ATMA Participaes with a short position of Hewlett Packard. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATMA Participaes and Hewlett Packard.
Diversification Opportunities for ATMA Participaes and Hewlett Packard
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ATMA and Hewlett is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding ATMA Participaes SA and Hewlett Packard Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hewlett Packard and ATMA Participaes 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 ATMA Participaes SA are associated (or correlated) with Hewlett Packard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hewlett Packard has no effect on the direction of ATMA Participaes i.e., ATMA Participaes and Hewlett Packard go up and down completely randomly.
Pair Corralation between ATMA Participaes and Hewlett Packard
Assuming the 90 days trading horizon ATMA Participaes SA is expected to under-perform the Hewlett Packard. In addition to that, ATMA Participaes is 1.48 times more volatile than Hewlett Packard Co. It trades about -0.08 of its total potential returns per unit of risk. Hewlett Packard Co is currently generating about 0.18 per unit of volatility. If you would invest 21,122 in Hewlett Packard Co on August 26, 2024 and sell it today you would earn a total of 1,095 from holding Hewlett Packard Co or generate 5.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ATMA Participaes SA vs. Hewlett Packard Co
Performance |
| Timeline |
| ATMA Participaes |
| Hewlett Packard |
ATMA Participaes and Hewlett Packard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATMA Participaes and Hewlett Packard
The main advantage of trading using opposite ATMA Participaes and Hewlett Packard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATMA Participaes position performs unexpectedly, Hewlett Packard 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 Hewlett Packard will offset losses from the drop in Hewlett Packard's long position.| ATMA Participaes vs. Mliuz SA | ATMA Participaes vs. Lojas Quero Quero SA | ATMA Participaes vs. Grupo SBF SA | ATMA Participaes vs. Enjoei SA |
| Hewlett Packard vs. BTG Pactual Logstica | Hewlett Packard vs. Plano Plano Desenvolvimento | Hewlett Packard vs. Cable One | Hewlett Packard vs. ATMA Participaes SA |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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