Correlation Between Atlantic Union and Minerals Technologies
Can any of the company-specific risk be diversified away by investing in both Atlantic Union and Minerals 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 Atlantic Union and Minerals Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlantic Union Bankshares and Minerals Technologies, you can compare the effects of market volatilities on Atlantic Union and Minerals 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 Atlantic Union with a short position of Minerals Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlantic Union and Minerals Technologies.
Diversification Opportunities for Atlantic Union and Minerals Technologies
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Atlantic and Minerals is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Atlantic Union Bankshares and Minerals Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Minerals Technologies and Atlantic Union 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 Atlantic Union Bankshares are associated (or correlated) with Minerals Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Minerals Technologies has no effect on the direction of Atlantic Union i.e., Atlantic Union and Minerals Technologies go up and down completely randomly.
Pair Corralation between Atlantic Union and Minerals Technologies
Assuming the 90 days horizon Atlantic Union Bankshares is expected to generate 0.8 times more return on investment than Minerals Technologies. However, Atlantic Union Bankshares is 1.25 times less risky than Minerals Technologies. It trades about 0.09 of its potential returns per unit of risk. Minerals Technologies is currently generating about 0.06 per unit of risk. If you would invest 1,863 in Atlantic Union Bankshares on September 14, 2024 and sell it today you would earn a total of 622.00 from holding Atlantic Union Bankshares or generate 33.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atlantic Union Bankshares vs. Minerals Technologies
Performance |
| Timeline |
| Atlantic Union Bankshares |
| Minerals Technologies |
Atlantic Union and Minerals Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atlantic Union and Minerals Technologies
The main advantage of trading using opposite Atlantic Union and Minerals Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlantic Union position performs unexpectedly, Minerals 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 Minerals Technologies will offset losses from the drop in Minerals Technologies' long position.| Atlantic Union vs. Kinsale Capital Group | Atlantic Union vs. Direct Line Insurance | Atlantic Union vs. Aspen Insurance Holdings | Atlantic Union vs. Under Armour C |
| Minerals Technologies vs. LyondellBasell Industries NV | Minerals Technologies vs. Cabot | Minerals Technologies vs. Westlake Chemical | Minerals Technologies vs. Air Products and |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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