Correlation Between AD Plastik and Atlantic Grupa

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

By analyzing existing cross correlation between AD Plastik dd and Atlantic Grupa dd, you can compare the effects of market volatilities on AD Plastik and Atlantic Grupa 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 AD Plastik with a short position of Atlantic Grupa. Check out your portfolio center. Please also check ongoing floating volatility patterns of AD Plastik and Atlantic Grupa.

Diversification Opportunities for AD Plastik and Atlantic Grupa

0.17

Correlation Coefficient

AD Plastik  Atlantic Grupa

Average diversification

The 3 months correlation between ADPL and Atlantic is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding AD Plastik dd and Atlantic Grupa dd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlantic Grupa dd and AD Plastik 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 AD Plastik dd are associated (or correlated) with Atlantic Grupa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlantic Grupa dd has no effect on the direction of AD Plastik i.e., AD Plastik and Atlantic Grupa go up and down completely randomly.

Pair Corralation between AD Plastik and Atlantic Grupa

Assuming the 90 days trading horizon AD Plastik dd is expected to generate 1.51 times more return on investment than Atlantic Grupa. However, AD Plastik is 1.51 times more volatile than Atlantic Grupa dd. It trades about -0.16 of its potential returns per unit of risk. Atlantic Grupa dd is currently generating about -0.3 per unit of risk. If you would invest  994.00  in AD Plastik dd on October 10, 2024 and sell it today you would lose (54.00) from holding AD Plastik dd or give up 5.43% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	88.24%
Values	Daily Returns

AD Plastik dd  vs.  Atlantic Grupa dd

AD Plastik dd

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AD Plastik dd has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in February 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Atlantic Grupa dd

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Atlantic Grupa dd has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with AD Plastik and Atlantic Grupa

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

The idea behind AD Plastik dd and Atlantic Grupa dd 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.