Correlation Between NYSE Composite and ATI Physical
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and ATI Physical 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 NYSE Composite and ATI Physical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and ATI Physical Therapy, you can compare the effects of market volatilities on NYSE Composite and ATI Physical 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 NYSE Composite with a short position of ATI Physical. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and ATI Physical.
Diversification Opportunities for NYSE Composite and ATI Physical
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and ATI is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and ATI Physical Therapy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATI Physical Therapy and NYSE Composite 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 NYSE Composite are associated (or correlated) with ATI Physical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATI Physical Therapy has no effect on the direction of NYSE Composite i.e., NYSE Composite and ATI Physical go up and down completely randomly.
Pair Corralation between NYSE Composite and ATI Physical
Assuming the 90 days trading horizon NYSE Composite is expected to generate 0.07 times more return on investment than ATI Physical. However, NYSE Composite is 15.26 times less risky than ATI Physical. It trades about 0.24 of its potential returns per unit of risk. ATI Physical Therapy is currently generating about -0.48 per unit of risk. If you would invest 1,954,967 in NYSE Composite on August 28, 2024 and sell it today you would earn a total of 67,069 from holding NYSE Composite or generate 3.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. ATI Physical Therapy
Performance |
| Timeline |
NYSE Composite and ATI Physical Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
ATI Physical Therapy
Pair trading matchups for ATI Physical
Pair Trading with NYSE Composite and ATI Physical
The main advantage of trading using opposite NYSE Composite and ATI Physical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, ATI Physical 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 ATI Physical will offset losses from the drop in ATI Physical's long position.| NYSE Composite vs. Hooker Furniture | NYSE Composite vs. Hudson Pacific Properties | NYSE Composite vs. Canlan Ice Sports | NYSE Composite vs. Boston Properties |
| ATI Physical vs. Universal Health Services | ATI Physical vs. Lifestance Health Group | ATI Physical vs. Select Medical Holdings | ATI Physical vs. Acadia Healthcare |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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