Correlation Between K Bro and Atrium Mortgage

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

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

Diversification Opportunities for K Bro and Atrium Mortgage

0.26

Correlation Coefficient

K Bro  Atrium Mortgage

Modest diversification

The 3 months correlation between KBRLF and Atrium is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding K Bro Linen and Atrium Mortgage Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atrium Mortgage Inve and K Bro 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 K Bro Linen are associated (or correlated) with Atrium Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atrium Mortgage Inve has no effect on the direction of K Bro i.e., K Bro and Atrium Mortgage go up and down completely randomly.

Pair Corralation between K Bro and Atrium Mortgage

Assuming the 90 days horizon K Bro Linen is expected to under-perform the Atrium Mortgage. But the pink sheet apears to be less risky and, when comparing its historical volatility, K Bro Linen is 1.44 times less risky than Atrium Mortgage. The pink sheet trades about -0.02 of its potential returns per unit of risk. The Atrium Mortgage Investment is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  774.00  in Atrium Mortgage Investment on April 27, 2025 and sell it today you would earn a total of  91.00  from holding Atrium Mortgage Investment or generate 11.76% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	57.14%
Values	Daily Returns

K Bro Linen  vs.  Atrium Mortgage Investment

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.

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 13 (%) 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.

Pair Trading with K Bro and Atrium Mortgage

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

The idea behind K Bro Linen and Atrium Mortgage Investment 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.