Correlation Between Timbercreek Financial and Atlas Engineered
Can any of the company-specific risk be diversified away by investing in both Timbercreek Financial and Atlas Engineered 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 Timbercreek Financial and Atlas Engineered into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Timbercreek Financial Corp and Atlas Engineered Products, you can compare the effects of market volatilities on Timbercreek Financial and Atlas Engineered 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 Timbercreek Financial with a short position of Atlas Engineered. Check out your portfolio center. Please also check ongoing floating volatility patterns of Timbercreek Financial and Atlas Engineered.
Diversification Opportunities for Timbercreek Financial and Atlas Engineered
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Timbercreek and Atlas is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Timbercreek Financial Corp and Atlas Engineered Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlas Engineered Products and Timbercreek Financial 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 Timbercreek Financial Corp are associated (or correlated) with Atlas Engineered. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlas Engineered Products has no effect on the direction of Timbercreek Financial i.e., Timbercreek Financial and Atlas Engineered go up and down completely randomly.
Pair Corralation between Timbercreek Financial and Atlas Engineered
Assuming the 90 days horizon Timbercreek Financial is expected to generate 3.06 times less return on investment than Atlas Engineered. But when comparing it to its historical volatility, Timbercreek Financial Corp is 4.59 times less risky than Atlas Engineered. It trades about 0.09 of its potential returns per unit of risk. Atlas Engineered Products is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 117.00 in Atlas Engineered Products on September 4, 2024 and sell it today you would earn a total of 4.00 from holding Atlas Engineered Products or generate 3.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Timbercreek Financial Corp vs. Atlas Engineered Products
Performance |
| Timeline |
| Timbercreek Financial |
| Atlas Engineered Products |
Timbercreek Financial and Atlas Engineered Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Timbercreek Financial and Atlas Engineered
The main advantage of trading using opposite Timbercreek Financial and Atlas Engineered positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Timbercreek Financial position performs unexpectedly, Atlas Engineered 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 Engineered will offset losses from the drop in Atlas Engineered's long position.| Timbercreek Financial vs. Atrium Mortgage Investment | Timbercreek Financial vs. MCAN Mortgage | Timbercreek Financial vs. Fiera Capital | Timbercreek Financial vs. Firm Capital Mortgage |
| Atlas Engineered vs. Redishred Capital Corp | Atlas Engineered vs. Fab Form Industries | Atlas Engineered vs. Inventronics | Atlas Engineered vs. Caldwell Partners International |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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