Correlation Between Chimera Investment and Atmos Energy
Can any of the company-specific risk be diversified away by investing in both Chimera Investment 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 Chimera Investment and Atmos Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chimera Investment and Atmos Energy, you can compare the effects of market volatilities on Chimera Investment 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 Chimera Investment with a short position of Atmos Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chimera Investment and Atmos Energy.
Diversification Opportunities for Chimera Investment and Atmos Energy
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chimera and Atmos is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Chimera Investment and Atmos Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atmos Energy and Chimera Investment 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 Chimera Investment 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 Chimera Investment i.e., Chimera Investment and Atmos Energy go up and down completely randomly.
Pair Corralation between Chimera Investment and Atmos Energy
Given the investment horizon of 90 days Chimera Investment is expected to generate 892.25 times less return on investment than Atmos Energy. But when comparing it to its historical volatility, Chimera Investment is 3.08 times less risky than Atmos Energy. It trades about 0.0 of its potential returns per unit of risk. Atmos Energy is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest 13,964 in Atmos Energy on August 30, 2024 and sell it today you would earn a total of 1,179 from holding Atmos Energy or generate 8.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chimera Investment vs. Atmos Energy
Performance |
| Timeline |
| Chimera Investment |
| Atmos Energy |
Chimera Investment and Atmos Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chimera Investment and Atmos Energy
The main advantage of trading using opposite Chimera Investment and Atmos Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chimera Investment 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.| Chimera Investment vs. Kite Realty Group | Chimera Investment vs. Verra Mobility Corp | Chimera Investment vs. National Vision Holdings | Chimera Investment vs. Old Dominion Freight |
| 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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