Correlation Between POSCO Holdings and Atrium Mortgage
Can any of the company-specific risk be diversified away by investing in both POSCO Holdings and Atrium Mortgage 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 POSCO Holdings and Atrium Mortgage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between POSCO Holdings and Atrium Mortgage Investment, you can compare the effects of market volatilities on POSCO Holdings and Atrium Mortgage 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 POSCO Holdings with a short position of Atrium Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of POSCO Holdings and Atrium Mortgage.
Diversification Opportunities for POSCO Holdings and Atrium Mortgage
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between POSCO and Atrium is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding POSCO Holdings and Atrium Mortgage Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atrium Mortgage Inve and POSCO Holdings 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 POSCO Holdings are associated (or correlated) with Atrium Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atrium Mortgage Inve has no effect on the direction of POSCO Holdings i.e., POSCO Holdings and Atrium Mortgage go up and down completely randomly.
Pair Corralation between POSCO Holdings and Atrium Mortgage
Considering the 90-day investment horizon POSCO Holdings is expected to under-perform the Atrium Mortgage. In addition to that, POSCO Holdings is 2.63 times more volatile than Atrium Mortgage Investment. It trades about -0.34 of its total potential returns per unit of risk. Atrium Mortgage Investment is currently generating about -0.08 per unit of volatility. If you would invest 824.00 in Atrium Mortgage Investment on September 4, 2024 and sell it today you would lose (15.00) from holding Atrium Mortgage Investment or give up 1.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
POSCO Holdings vs. Atrium Mortgage Investment
Performance |
| Timeline |
| POSCO Holdings |
| Atrium Mortgage Inve |
POSCO Holdings and Atrium Mortgage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with POSCO Holdings and Atrium Mortgage
The main advantage of trading using opposite POSCO Holdings and Atrium Mortgage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if POSCO Holdings position performs unexpectedly, Atrium Mortgage 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 Atrium Mortgage will offset losses from the drop in Atrium Mortgage's long position.| POSCO Holdings vs. Olympic Steel | POSCO Holdings vs. Universal Stainless Alloy | POSCO Holdings vs. Outokumpu Oyj ADR | POSCO Holdings vs. Ternium SA ADR |
| Atrium Mortgage vs. Western Asset Global | Atrium Mortgage vs. Invesco Trust For | Atrium Mortgage vs. Logan Ridge Finance | Atrium Mortgage vs. Invesco Advantage MIT |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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