Correlation Between Atrium Mortgage and K Bro

Can any of the company-specific risk be diversified away by investing in both Atrium Mortgage and K Bro 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 Atrium Mortgage and K Bro into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Atrium Mortgage Investment and K Bro Linen, you can compare the effects of market volatilities on Atrium Mortgage and K Bro 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 Atrium Mortgage with a short position of K Bro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atrium Mortgage and K Bro.

Diversification Opportunities for Atrium Mortgage and K Bro

0.23

Correlation Coefficient

Atrium Mortgage  K Bro

Modest diversification

The 3 months correlation between Atrium and KBRLF is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Atrium Mortgage Investment and K Bro Linen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on K Bro Linen and Atrium Mortgage 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 Atrium Mortgage Investment are associated (or correlated) with K Bro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of K Bro Linen has no effect on the direction of Atrium Mortgage i.e., Atrium Mortgage and K Bro go up and down completely randomly.

Pair Corralation between Atrium Mortgage and K Bro

Assuming the 90 days horizon Atrium Mortgage Investment is expected to generate 1.45 times more return on investment than K Bro. However, Atrium Mortgage is 1.45 times more volatile than K Bro Linen. It trades about 0.19 of its potential returns per unit of risk. K Bro Linen is currently generating about -0.02 per unit of risk. If you would invest  764.00  in Atrium Mortgage Investment on April 30, 2025 and sell it today you would earn a total of  93.00  from holding Atrium Mortgage Investment or generate 12.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	60.32%
Values	Daily Returns

Atrium Mortgage Investment  vs.  K Bro Linen

Atrium Mortgage Inve

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Atrium Mortgage Investment are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Atrium Mortgage may actually be approaching a critical reversion point that can send shares even higher in August 2025.

K Bro Linen

Risk-Adjusted Performance

Very Weak

Over the last 90 days K Bro Linen has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, K Bro is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Atrium Mortgage and K Bro

The main advantage of trading using opposite Atrium Mortgage and K Bro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atrium Mortgage position performs unexpectedly, K Bro 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 K Bro will offset losses from the drop in K Bro's long position.

The idea behind Atrium Mortgage Investment and K Bro Linen pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.