Correlation Between Atlas Resources and NYSE Composite
Can any of the company-specific risk be diversified away by investing in both Atlas Resources and NYSE Composite 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 Atlas Resources and NYSE Composite into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atlas Resources Tbk and NYSE Composite, you can compare the effects of market volatilities on Atlas Resources and NYSE Composite 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 Atlas Resources with a short position of NYSE Composite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlas Resources and NYSE Composite.
Diversification Opportunities for Atlas Resources and NYSE Composite
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Atlas and NYSE is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Atlas Resources Tbk and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite and Atlas Resources 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 Atlas Resources Tbk are associated (or correlated) with NYSE Composite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NYSE Composite has no effect on the direction of Atlas Resources i.e., Atlas Resources and NYSE Composite go up and down completely randomly.
Pair Corralation between Atlas Resources and NYSE Composite
Assuming the 90 days trading horizon Atlas Resources Tbk is expected to generate 3.18 times more return on investment than NYSE Composite. However, Atlas Resources is 3.18 times more volatile than NYSE Composite. It trades about 0.23 of its potential returns per unit of risk. NYSE Composite is currently generating about -0.12 per unit of risk. If you would invest 27,600 in Atlas Resources Tbk on February 5, 2024 and sell it today you would earn a total of 2,000 from holding Atlas Resources Tbk or generate 7.25% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 68.18% |
Values | Daily Returns |
Atlas Resources Tbk vs. NYSE Composite
Performance |
Timeline |
Atlas Resources and NYSE Composite Volatility Contrast
Predicted Return Density |
Returns |
Atlas Resources Tbk
Pair trading matchups for Atlas Resources
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with Atlas Resources and NYSE Composite
The main advantage of trading using opposite Atlas Resources and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atlas Resources position performs unexpectedly, NYSE Composite 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 NYSE Composite will offset losses from the drop in NYSE Composite's long position.Atlas Resources vs. PT MNC Energy | Atlas Resources vs. Tanah Laut Tbk | Atlas Resources vs. Indorama Synthetics Tbk | Atlas Resources vs. Fortune Mate Indonesia |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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