Correlation Between Axway Software and ATEME SA
Can any of the company-specific risk be diversified away by investing in both Axway Software and ATEME SA 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 Axway Software and ATEME SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Axway Software and ATEME SA, you can compare the effects of market volatilities on Axway Software and ATEME SA 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 Axway Software with a short position of ATEME SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Axway Software and ATEME SA.
Diversification Opportunities for Axway Software and ATEME SA
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Axway and ATEME is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Axway Software and ATEME SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATEME SA and Axway Software 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 Axway Software are associated (or correlated) with ATEME SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATEME SA has no effect on the direction of Axway Software i.e., Axway Software and ATEME SA go up and down completely randomly.
Pair Corralation between Axway Software and ATEME SA
Assuming the 90 days trading horizon Axway Software is expected to generate 0.51 times more return on investment than ATEME SA. However, Axway Software is 1.98 times less risky than ATEME SA. It trades about 0.06 of its potential returns per unit of risk. ATEME SA is currently generating about -0.02 per unit of risk. If you would invest 2,226 in Axway Software on September 2, 2024 and sell it today you would earn a total of 494.00 from holding Axway Software or generate 22.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Axway Software vs. ATEME SA
Performance |
| Timeline |
| Axway Software |
| ATEME SA |
Axway Software and ATEME SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Axway Software and ATEME SA
The main advantage of trading using opposite Axway Software and ATEME SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Axway Software position performs unexpectedly, ATEME SA 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 ATEME SA will offset losses from the drop in ATEME SA's long position.| Axway Software vs. Sopra Steria Group | Axway Software vs. Aubay Socit Anonyme | Axway Software vs. Lectra SA | Axway Software vs. Esker SA |
| ATEME SA vs. Chargeurs SA | ATEME SA vs. Straumann Holding AG | ATEME SA vs. Manitou BF SA | ATEME SA vs. Amundi Index Solutions |
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 Stocks Directory module to find actively traded stocks across global markets.
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