Correlation Between FirstCash and Atlanticus Holdings
Can any of the company-specific risk be diversified away by investing in both FirstCash 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 FirstCash and Atlanticus Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FirstCash and Atlanticus Holdings Corp, you can compare the effects of market volatilities on FirstCash 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 FirstCash with a short position of Atlanticus Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of FirstCash and Atlanticus Holdings.
Diversification Opportunities for FirstCash and Atlanticus Holdings
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FirstCash and Atlanticus is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding FirstCash 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 FirstCash 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 FirstCash 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 FirstCash i.e., FirstCash and Atlanticus Holdings go up and down completely randomly.
Pair Corralation between FirstCash and Atlanticus Holdings
Given the investment horizon of 90 days FirstCash is expected to generate 1.46 times less return on investment than Atlanticus Holdings. But when comparing it to its historical volatility, FirstCash is 1.03 times less risky than Atlanticus Holdings. It trades about 0.03 of its potential returns per unit of risk. Atlanticus Holdings Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,822 in Atlanticus Holdings Corp on August 27, 2024 and sell it today you would earn a total of 555.00 from holding Atlanticus Holdings Corp or generate 30.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
FirstCash vs. Atlanticus Holdings Corp
Performance |
| Timeline |
| FirstCash |
| Atlanticus Holdings Corp |
FirstCash and Atlanticus Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FirstCash and Atlanticus Holdings
The main advantage of trading using opposite FirstCash and Atlanticus Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FirstCash 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.| FirstCash vs. World Acceptance | FirstCash vs. Enova International | FirstCash vs. Green Dot | FirstCash vs. Medallion Financial Corp |
| Atlanticus Holdings vs. Citizens Financial Group | Atlanticus Holdings vs. Wells Fargo | Atlanticus Holdings vs. Equitable Holdings |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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