Correlation Between Lincoln Inflation and Atac Inflation

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

By analyzing existing cross correlation between Lincoln Inflation Plus and Atac Inflation Rotation, you can compare the effects of market volatilities on Lincoln Inflation and Atac Inflation 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 Lincoln Inflation with a short position of Atac Inflation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lincoln Inflation and Atac Inflation.

Diversification Opportunities for Lincoln Inflation and Atac Inflation

0.61

Correlation Coefficient

Lincoln Inflation  Atac Inflation

Poor diversification

The 3 months correlation between Lincoln and Atac is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Lincoln Inflation Plus and Atac Inflation Rotation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atac Inflation Rotation and Lincoln Inflation 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 Lincoln Inflation Plus are associated (or correlated) with Atac Inflation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atac Inflation Rotation has no effect on the direction of Lincoln Inflation i.e., Lincoln Inflation and Atac Inflation go up and down completely randomly.

Pair Corralation between Lincoln Inflation and Atac Inflation

Assuming the 90 days horizon Lincoln Inflation Plus is expected to under-perform the Atac Inflation. But the mutual fund apears to be less risky and, when comparing its historical volatility, Lincoln Inflation Plus is 3.06 times less risky than Atac Inflation. The mutual fund trades about 0.0 of its potential returns per unit of risk. The Atac Inflation Rotation is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest  3,357  in Atac Inflation Rotation on May 5, 2025 and sell it today you would earn a total of  589.00  from holding Atac Inflation Rotation or generate 17.55% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Lincoln Inflation Plus  vs.  Atac Inflation Rotation

Lincoln Inflation Plus

Risk-Adjusted Performance

Very Weak

Over the last 90 days Lincoln Inflation Plus has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Lincoln Inflation is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Atac Inflation Rotation

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Atac Inflation Rotation are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly unfluctuating fundamental indicators, Atac Inflation showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Lincoln Inflation and Atac Inflation

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

The idea behind Lincoln Inflation Plus and Atac Inflation Rotation 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.

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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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.