Correlation Between IShares Trust and ATMA Participaes
Can any of the company-specific risk be diversified away by investing in both IShares Trust and ATMA Participaes 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 IShares Trust and ATMA Participaes into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Trust and ATMA Participaes SA, you can compare the effects of market volatilities on IShares Trust and ATMA Participaes 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 IShares Trust with a short position of ATMA Participaes. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Trust and ATMA Participaes.
Diversification Opportunities for IShares Trust and ATMA Participaes
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between IShares and ATMA is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding iShares Trust and ATMA Participaes SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATMA Participaes and IShares Trust 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 iShares Trust are associated (or correlated) with ATMA Participaes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATMA Participaes has no effect on the direction of IShares Trust i.e., IShares Trust and ATMA Participaes go up and down completely randomly.
Pair Corralation between IShares Trust and ATMA Participaes
Assuming the 90 days trading horizon IShares Trust is expected to generate 1.36 times less return on investment than ATMA Participaes. But when comparing it to its historical volatility, iShares Trust is 1.98 times less risky than ATMA Participaes. It trades about 0.04 of its potential returns per unit of risk. ATMA Participaes SA is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 120.00 in ATMA Participaes SA on August 27, 2024 and sell it today you would earn a total of 10.00 from holding ATMA Participaes SA or generate 8.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 89.28% |
| Values | Daily Returns |
iShares Trust vs. ATMA Participaes SA
Performance |
| Timeline |
| iShares Trust |
| ATMA Participaes |
IShares Trust and ATMA Participaes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Trust and ATMA Participaes
The main advantage of trading using opposite IShares Trust and ATMA Participaes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Trust position performs unexpectedly, ATMA Participaes 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 ATMA Participaes will offset losses from the drop in ATMA Participaes' long position.| IShares Trust vs. BTG Pactual Logstica | IShares Trust vs. Plano Plano Desenvolvimento | IShares Trust vs. Companhia Habitasul de | IShares Trust vs. The Procter Gamble |
| ATMA Participaes vs. Triunfo Participaes e | ATMA Participaes vs. Allpark Empreendimentos Participaes | ATMA Participaes vs. Azevedo Travassos SA | ATMA Participaes vs. Azevedo Travassos SA |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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