Correlation Between Flotek Industries and Atlas Energy
Can any of the company-specific risk be diversified away by investing in both Flotek Industries and Atlas 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 Flotek Industries and Atlas Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flotek Industries and Atlas Energy Solutions, you can compare the effects of market volatilities on Flotek Industries and Atlas 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 Flotek Industries with a short position of Atlas Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flotek Industries and Atlas Energy.
Diversification Opportunities for Flotek Industries and Atlas Energy
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Flotek and Atlas is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Flotek Industries and Atlas Energy Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlas Energy Solutions and Flotek Industries 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 Flotek Industries are associated (or correlated) with Atlas Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlas Energy Solutions has no effect on the direction of Flotek Industries i.e., Flotek Industries and Atlas Energy go up and down completely randomly.
Pair Corralation between Flotek Industries and Atlas Energy
Considering the 90-day investment horizon Flotek Industries is expected to generate 1.76 times more return on investment than Atlas Energy. However, Flotek Industries is 1.76 times more volatile than Atlas Energy Solutions. It trades about 0.44 of its potential returns per unit of risk. Atlas Energy Solutions is currently generating about 0.32 per unit of risk. If you would invest 507.00 in Flotek Industries on September 2, 2024 and sell it today you would earn a total of 343.00 from holding Flotek Industries or generate 67.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flotek Industries vs. Atlas Energy Solutions
Performance |
| Timeline |
| Flotek Industries |
| Atlas Energy Solutions |
Flotek Industries and Atlas Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flotek Industries and Atlas Energy
The main advantage of trading using opposite Flotek Industries and Atlas Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flotek Industries position performs unexpectedly, Atlas 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 Atlas Energy will offset losses from the drop in Atlas Energy's long position.| Flotek Industries vs. ProPetro Holding Corp | Flotek Industries vs. Liberty Oilfield Services | Flotek Industries vs. KLX Energy Services | Flotek Industries vs. MRC Global |
| Atlas Energy vs. ProPetro Holding Corp | Atlas Energy vs. Ranger Energy Services | Atlas Energy vs. Flotek Industries | Atlas Energy vs. Liberty Oilfield Services |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |