Correlation Between Prysmian SpA and Atkore International
Can any of the company-specific risk be diversified away by investing in both Prysmian SpA and Atkore International 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 Prysmian SpA and Atkore International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prysmian SpA and Atkore International Group, you can compare the effects of market volatilities on Prysmian SpA and Atkore International 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 Prysmian SpA with a short position of Atkore International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prysmian SpA and Atkore International.
Diversification Opportunities for Prysmian SpA and Atkore International
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Prysmian and Atkore is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Prysmian SpA and Atkore International Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atkore International and Prysmian SpA 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 Prysmian SpA are associated (or correlated) with Atkore International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atkore International has no effect on the direction of Prysmian SpA i.e., Prysmian SpA and Atkore International go up and down completely randomly.
Pair Corralation between Prysmian SpA and Atkore International
Assuming the 90 days horizon Prysmian SpA is expected to generate 1.55 times more return on investment than Atkore International. However, Prysmian SpA is 1.55 times more volatile than Atkore International Group. It trades about 0.05 of its potential returns per unit of risk. Atkore International Group is currently generating about -0.01 per unit of risk. If you would invest 3,342 in Prysmian SpA on August 29, 2024 and sell it today you would earn a total of 3,135 from holding Prysmian SpA or generate 93.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 96.98% |
| Values | Daily Returns |
Prysmian SpA vs. Atkore International Group
Performance |
| Timeline |
| Prysmian SpA |
| Atkore International |
Prysmian SpA and Atkore International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prysmian SpA and Atkore International
The main advantage of trading using opposite Prysmian SpA and Atkore International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prysmian SpA position performs unexpectedly, Atkore International 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 Atkore International will offset losses from the drop in Atkore International's long position.| Prysmian SpA vs. Atkore International Group | Prysmian SpA vs. FuelCell Energy | Prysmian SpA vs. Plug Power |
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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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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