Correlation Between ATS and Laser Photonics
Can any of the company-specific risk be diversified away by investing in both ATS and Laser Photonics 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 ATS and Laser Photonics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATS Corporation and Laser Photonics, you can compare the effects of market volatilities on ATS and Laser Photonics 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 ATS with a short position of Laser Photonics. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATS and Laser Photonics.
Diversification Opportunities for ATS and Laser Photonics
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ATS and Laser is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding ATS Corp. and Laser Photonics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Laser Photonics and ATS 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 ATS Corporation are associated (or correlated) with Laser Photonics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Laser Photonics has no effect on the direction of ATS i.e., ATS and Laser Photonics go up and down completely randomly.
Pair Corralation between ATS and Laser Photonics
Considering the 90-day investment horizon ATS is expected to generate 19155.0 times less return on investment than Laser Photonics. But when comparing it to its historical volatility, ATS Corporation is 6.86 times less risky than Laser Photonics. It trades about 0.0 of its potential returns per unit of risk. Laser Photonics is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 195.00 in Laser Photonics on September 5, 2024 and sell it today you would earn a total of 355.00 from holding Laser Photonics or generate 182.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ATS Corp. vs. Laser Photonics
Performance |
| Timeline |
| ATS Corporation |
| Laser Photonics |
ATS and Laser Photonics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATS and Laser Photonics
The main advantage of trading using opposite ATS and Laser Photonics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATS position performs unexpectedly, Laser Photonics 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 Laser Photonics will offset losses from the drop in Laser Photonics' long position.The idea behind ATS Corporation and Laser Photonics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Laser Photonics vs. Nuburu Inc | Laser Photonics vs. JE Cleantech Holdings | Laser Photonics vs. Reelcause | Laser Photonics vs. Shapeways Holdings, Common |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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