Correlation Between Brookfield Infrastructure and Atmos Energy
Can any of the company-specific risk be diversified away by investing in both Brookfield Infrastructure and Atmos Energy 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 Brookfield Infrastructure and Atmos Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Brookfield Infrastructure Corp and Atmos Energy, you can compare the effects of market volatilities on Brookfield Infrastructure and Atmos Energy 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 Brookfield Infrastructure with a short position of Atmos Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brookfield Infrastructure and Atmos Energy.
Diversification Opportunities for Brookfield Infrastructure and Atmos Energy
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Brookfield and Atmos is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Brookfield Infrastructure Corp and Atmos Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atmos Energy and Brookfield Infrastructure 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 Brookfield Infrastructure Corp are associated (or correlated) with Atmos Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atmos Energy has no effect on the direction of Brookfield Infrastructure i.e., Brookfield Infrastructure and Atmos Energy go up and down completely randomly.
Pair Corralation between Brookfield Infrastructure and Atmos Energy
Given the investment horizon of 90 days Brookfield Infrastructure is expected to generate 1.99 times less return on investment than Atmos Energy. In addition to that, Brookfield Infrastructure is 1.83 times more volatile than Atmos Energy. It trades about 0.02 of its total potential returns per unit of risk. Atmos Energy is currently generating about 0.06 per unit of volatility. If you would invest 11,058 in Atmos Energy on August 24, 2024 and sell it today you would earn a total of 3,947 from holding Atmos Energy or generate 35.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Brookfield Infrastructure Corp vs. Atmos Energy
Performance |
| Timeline |
| Brookfield Infrastructure |
| Atmos Energy |
Brookfield Infrastructure and Atmos Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Brookfield Infrastructure and Atmos Energy
The main advantage of trading using opposite Brookfield Infrastructure and Atmos Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brookfield Infrastructure position performs unexpectedly, Atmos Energy 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 Atmos Energy will offset losses from the drop in Atmos Energy's long position.| Brookfield Infrastructure vs. NewJersey Resources | Brookfield Infrastructure vs. Atmos Energy | Brookfield Infrastructure vs. UGI Corporation | Brookfield Infrastructure vs. Chesapeake Utilities |
| Atmos Energy vs. NewJersey Resources | Atmos Energy vs. One Gas | Atmos Energy vs. Northwest Natural Gas | Atmos Energy vs. Chesapeake Utilities |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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