Correlation Between Blue Star and ATAC Resources
Can any of the company-specific risk be diversified away by investing in both Blue Star and ATAC Resources 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 Blue Star and ATAC Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Star Gold and ATAC Resources, you can compare the effects of market volatilities on Blue Star and ATAC Resources 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 Blue Star with a short position of ATAC Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Star and ATAC Resources.
Diversification Opportunities for Blue Star and ATAC Resources
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Blue and ATAC is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Blue Star Gold and ATAC Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATAC Resources and Blue Star 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 Blue Star Gold are associated (or correlated) with ATAC Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATAC Resources has no effect on the direction of Blue Star i.e., Blue Star and ATAC Resources go up and down completely randomly.
Pair Corralation between Blue Star and ATAC Resources
Assuming the 90 days horizon Blue Star Gold is expected to under-perform the ATAC Resources. But the otc stock apears to be less risky and, when comparing its historical volatility, Blue Star Gold is 1.17 times less risky than ATAC Resources. The otc stock trades about -0.03 of its potential returns per unit of risk. The ATAC Resources is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 5.00 in ATAC Resources on October 24, 2024 and sell it today you would earn a total of 4.28 from holding ATAC Resources or generate 85.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 21.98% |
| Values | Daily Returns |
Blue Star Gold vs. ATAC Resources
Performance |
| Timeline |
| Blue Star Gold |
| ATAC Resources |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Blue Star and ATAC Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blue Star and ATAC Resources
The main advantage of trading using opposite Blue Star and ATAC Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Star position performs unexpectedly, ATAC Resources 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 ATAC Resources will offset losses from the drop in ATAC Resources' long position.| Blue Star vs. Argo Gold | Blue Star vs. Minnova Corp | Blue Star vs. Angkor Resources Corp | Blue Star vs. Advance United Holdings |
| ATAC Resources vs. Minnova Corp | ATAC Resources vs. Argo Gold | ATAC Resources vs. Advance Gold Corp | ATAC Resources vs. Blue Star Gold |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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