Correlation Between Atrium Ljungberg and T MOBILE

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

By analyzing existing cross correlation between Atrium Ljungberg AB and T MOBILE US, you can compare the effects of market volatilities on Atrium Ljungberg and T MOBILE 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 Ljungberg with a short position of T MOBILE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atrium Ljungberg and T MOBILE.

Diversification Opportunities for Atrium Ljungberg and T MOBILE

-0.82

Correlation Coefficient

Atrium Ljungberg  T MOBILE

Pay attention - limited upside

The 3 months correlation between Atrium and TM5 is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Atrium Ljungberg AB and T MOBILE US in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on T MOBILE US and Atrium Ljungberg 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 Ljungberg AB are associated (or correlated) with T MOBILE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of T MOBILE US has no effect on the direction of Atrium Ljungberg i.e., Atrium Ljungberg and T MOBILE go up and down completely randomly.

Pair Corralation between Atrium Ljungberg and T MOBILE

Assuming the 90 days horizon Atrium Ljungberg AB is expected to under-perform the T MOBILE. But the stock apears to be less risky and, when comparing its historical volatility, Atrium Ljungberg AB is 1.06 times less risky than T MOBILE. The stock trades about -0.26 of its potential returns per unit of risk. The T MOBILE US is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  18,540  in T MOBILE US on September 29, 2024 and sell it today you would earn a total of  2,750  from holding T MOBILE US or generate 14.83% return on investment over 90 days.

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

Atrium Ljungberg AB  vs.  T MOBILE US

Atrium Ljungberg

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Atrium Ljungberg AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

T MOBILE US

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in T MOBILE US are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, T MOBILE unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Atrium Ljungberg and T MOBILE

The main advantage of trading using opposite Atrium Ljungberg and T MOBILE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atrium Ljungberg position performs unexpectedly, T MOBILE 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 T MOBILE will offset losses from the drop in T MOBILE's long position.

The idea behind Atrium Ljungberg AB and T MOBILE US 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..