Correlation Between Atmos Energy and Vera Bradley
Can any of the company-specific risk be diversified away by investing in both Atmos Energy and Vera Bradley 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 Atmos Energy and Vera Bradley into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atmos Energy and Vera Bradley, you can compare the effects of market volatilities on Atmos Energy and Vera Bradley 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 Atmos Energy with a short position of Vera Bradley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atmos Energy and Vera Bradley.
Diversification Opportunities for Atmos Energy and Vera Bradley
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Atmos and Vera is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Atmos Energy and Vera Bradley in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vera Bradley and Atmos Energy 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 Atmos Energy are associated (or correlated) with Vera Bradley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vera Bradley has no effect on the direction of Atmos Energy i.e., Atmos Energy and Vera Bradley go up and down completely randomly.
Pair Corralation between Atmos Energy and Vera Bradley
Considering the 90-day investment horizon Atmos Energy is expected to generate 0.29 times more return on investment than Vera Bradley. However, Atmos Energy is 3.45 times less risky than Vera Bradley. It trades about 0.2 of its potential returns per unit of risk. Vera Bradley is currently generating about -0.15 per unit of risk. If you would invest 13,625 in Atmos Energy on December 11, 2024 and sell it today you would earn a total of 1,367 from holding Atmos Energy or generate 10.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atmos Energy vs. Vera Bradley
Performance |
| Timeline |
| Atmos Energy |
| Vera Bradley |
Atmos Energy and Vera Bradley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atmos Energy and Vera Bradley
The main advantage of trading using opposite Atmos Energy and Vera Bradley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atmos Energy position performs unexpectedly, Vera Bradley 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 Vera Bradley will offset losses from the drop in Vera Bradley's long position.| Atmos Energy vs. NewJersey Resources | Atmos Energy vs. One Gas | Atmos Energy vs. Northwest Natural Gas | Atmos Energy vs. Chesapeake Utilities |
| Vera Bradley vs. Rocky Brands | Vera Bradley vs. Steven Madden | Vera Bradley vs. Wolverine World Wide | Vera Bradley vs. Caleres |
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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