Correlation Between Act Financial and Atlas For

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

By analyzing existing cross correlation between Act Financial and Atlas For Investment, you can compare the effects of market volatilities on Act Financial and Atlas For 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 Act Financial with a short position of Atlas For. Check out your portfolio center. Please also check ongoing floating volatility patterns of Act Financial and Atlas For.

Diversification Opportunities for Act Financial and Atlas For

0.11

Correlation Coefficient

Act Financial  Atlas For

Average diversification

The 3 months correlation between Act and Atlas is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Act Financial and Atlas For Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlas For Investment and Act Financial 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 Act Financial are associated (or correlated) with Atlas For. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlas For Investment has no effect on the direction of Act Financial i.e., Act Financial and Atlas For go up and down completely randomly.

Pair Corralation between Act Financial and Atlas For

Assuming the 90 days trading horizon Act Financial is expected to under-perform the Atlas For. But the stock apears to be less risky and, when comparing its historical volatility, Act Financial is 1.22 times less risky than Atlas For. The stock trades about -0.03 of its potential returns per unit of risk. The Atlas For Investment is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  24.00  in Atlas For Investment on October 10, 2024 and sell it today you would earn a total of  94.00  from holding Atlas For Investment or generate 391.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	30.03%
Values	Daily Returns

Act Financial  vs.  Atlas For Investment

Act Financial

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Act Financial are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Act Financial may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Atlas For Investment

Risk-Adjusted Performance

23 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Atlas For Investment are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Atlas For reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Act Financial and Atlas For

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

The idea behind Act Financial and Atlas For 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.

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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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.