Correlation Between Atlas Consolidated and Robinsons Retail

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

By analyzing existing cross correlation between Atlas Consolidated Mining and Robinsons Retail Holdings, you can compare the effects of market volatilities on Atlas Consolidated and Robinsons Retail 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 Atlas Consolidated with a short position of Robinsons Retail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atlas Consolidated and Robinsons Retail.

Diversification Opportunities for Atlas Consolidated and Robinsons Retail

0.65

Correlation Coefficient

Atlas Consolidated  Robinsons Retail

Poor diversification

The 3 months correlation between Atlas and Robinsons is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Atlas Consolidated Mining and Robinsons Retail Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robinsons Retail Holdings and Atlas Consolidated 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 Atlas Consolidated Mining are associated (or correlated) with Robinsons Retail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Robinsons Retail Holdings has no effect on the direction of Atlas Consolidated i.e., Atlas Consolidated and Robinsons Retail go up and down completely randomly.

Pair Corralation between Atlas Consolidated and Robinsons Retail

Assuming the 90 days trading horizon Atlas Consolidated Mining is expected to generate 1.65 times more return on investment than Robinsons Retail. However, Atlas Consolidated is 1.65 times more volatile than Robinsons Retail Holdings. It trades about -0.01 of its potential returns per unit of risk. Robinsons Retail Holdings is currently generating about -0.04 per unit of risk. If you would invest  423.00  in Atlas Consolidated Mining on December 2, 2024 and sell it today you would lose (15.00) from holding Atlas Consolidated Mining or give up 3.55% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.33%
Values	Daily Returns

Atlas Consolidated Mining  vs.  Robinsons Retail Holdings

Atlas Consolidated Mining

Risk-Adjusted Performance

Very Weak

Over the last 90 days Atlas Consolidated Mining has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Atlas Consolidated is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Robinsons Retail Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Robinsons Retail Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Robinsons Retail is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Atlas Consolidated and Robinsons Retail

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

The idea behind Atlas Consolidated Mining and Robinsons Retail Holdings 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.