Correlation Between Capital One and Atlanticus Holdings
Can any of the company-specific risk be diversified away by investing in both Capital One and Atlanticus Holdings 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 Capital One and Atlanticus Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Capital One Financial and Atlanticus Holdings Corp, you can compare the effects of market volatilities on Capital One and Atlanticus Holdings 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 Capital One with a short position of Atlanticus Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital One and Atlanticus Holdings.
Diversification Opportunities for Capital One and Atlanticus Holdings
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Capital and Atlanticus is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Capital One Financial and Atlanticus Holdings Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlanticus Holdings Corp and Capital One 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 Capital One Financial are associated (or correlated) with Atlanticus Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlanticus Holdings Corp has no effect on the direction of Capital One i.e., Capital One and Atlanticus Holdings go up and down completely randomly.
Pair Corralation between Capital One and Atlanticus Holdings
Assuming the 90 days trading horizon Capital One Financial is expected to under-perform the Atlanticus Holdings. In addition to that, Capital One is 1.06 times more volatile than Atlanticus Holdings Corp. It trades about -0.19 of its total potential returns per unit of risk. Atlanticus Holdings Corp is currently generating about 0.06 per unit of volatility. If you would invest 2,289 in Atlanticus Holdings Corp on September 12, 2024 and sell it today you would earn a total of 24.00 from holding Atlanticus Holdings Corp or generate 1.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Capital One Financial vs. Atlanticus Holdings Corp
Performance |
| Timeline |
| Capital One Financial |
| Atlanticus Holdings Corp |
Capital One and Atlanticus Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital One and Atlanticus Holdings
The main advantage of trading using opposite Capital One and Atlanticus Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital One position performs unexpectedly, Atlanticus Holdings 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 Atlanticus Holdings will offset losses from the drop in Atlanticus Holdings' long position.| Capital One vs. Synchrony Financial | Capital One vs. Synchrony Financial | Capital One vs. Atlanticus Holdings Corp | Capital One vs. Medallion Bank PR |
| Atlanticus Holdings vs. Babcock Wilcox Enterprises | Atlanticus Holdings vs. XOMA Corporation | Atlanticus Holdings vs. Brighthouse Financial | Atlanticus Holdings vs. Presidio Property Trust |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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