Correlation Between Turning Point and Atacado SA
Can any of the company-specific risk be diversified away by investing in both Turning Point and Atacado SA 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 Turning Point and Atacado SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Turning Point Brands and Atacado SA, you can compare the effects of market volatilities on Turning Point and Atacado SA 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 Turning Point with a short position of Atacado SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Turning Point and Atacado SA.
Diversification Opportunities for Turning Point and Atacado SA
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Turning and Atacado is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Turning Point Brands and Atacado SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atacado SA and Turning Point 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 Turning Point Brands are associated (or correlated) with Atacado SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atacado SA has no effect on the direction of Turning Point i.e., Turning Point and Atacado SA go up and down completely randomly.
Pair Corralation between Turning Point and Atacado SA
If you would invest 5,250 in Turning Point Brands on September 12, 2024 and sell it today you would earn a total of 1,138 from holding Turning Point Brands or generate 21.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Turning Point Brands vs. Atacado SA
Performance |
| Timeline |
| Turning Point Brands |
| Atacado SA |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Turning Point and Atacado SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Turning Point and Atacado SA
The main advantage of trading using opposite Turning Point and Atacado SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Turning Point position performs unexpectedly, Atacado SA 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 Atacado SA will offset losses from the drop in Atacado SA's long position.| Turning Point vs. Universal | Turning Point vs. Imperial Brands PLC | Turning Point vs. British American Tobacco | Turning Point vs. Philip Morris International |
| Atacado SA vs. Freedom Bank of | Atacado SA vs. Zhihu Inc ADR | Atacado SA vs. Discover Financial Services | Atacado SA vs. CDW Corp |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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