Correlation Between Deluxe and ATIF Holdings
Can any of the company-specific risk be diversified away by investing in both Deluxe and ATIF 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 Deluxe and ATIF Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deluxe and ATIF Holdings, you can compare the effects of market volatilities on Deluxe and ATIF 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 Deluxe with a short position of ATIF Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deluxe and ATIF Holdings.
Diversification Opportunities for Deluxe and ATIF Holdings
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Deluxe and ATIF is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Deluxe and ATIF Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATIF Holdings and Deluxe 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 Deluxe are associated (or correlated) with ATIF Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATIF Holdings has no effect on the direction of Deluxe i.e., Deluxe and ATIF Holdings go up and down completely randomly.
Pair Corralation between Deluxe and ATIF Holdings
Considering the 90-day investment horizon Deluxe is expected to generate 0.44 times more return on investment than ATIF Holdings. However, Deluxe is 2.27 times less risky than ATIF Holdings. It trades about 0.3 of its potential returns per unit of risk. ATIF Holdings is currently generating about -0.17 per unit of risk. If you would invest 1,911 in Deluxe on August 31, 2024 and sell it today you would earn a total of 416.00 from holding Deluxe or generate 21.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Deluxe vs. ATIF Holdings
Performance |
| Timeline |
| Deluxe |
| ATIF Holdings |
Deluxe and ATIF Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deluxe and ATIF Holdings
The main advantage of trading using opposite Deluxe and ATIF Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deluxe position performs unexpectedly, ATIF 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 ATIF Holdings will offset losses from the drop in ATIF Holdings' long position.| Deluxe vs. Criteo Sa | Deluxe vs. Emerald Expositions Events | Deluxe vs. Marchex | Deluxe vs. Integral Ad Science |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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