Correlation Between Atac Inflation and Cullen International

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

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

Diversification Opportunities for Atac Inflation and Cullen International

0.56

Correlation Coefficient

Atac Inflation  Cullen International

Very weak diversification

The 3 months correlation between Atac and Cullen is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Atac Inflation Rotation and Cullen International High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cullen International High and Atac 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 Atac Inflation Rotation are associated (or correlated) with Cullen International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cullen International High has no effect on the direction of Atac Inflation i.e., Atac Inflation and Cullen International go up and down completely randomly.

Pair Corralation between Atac Inflation and Cullen International

Assuming the 90 days horizon Atac Inflation Rotation is expected to under-perform the Cullen International. In addition to that, Atac Inflation is 1.0 times more volatile than Cullen International High. It trades about -0.02 of its total potential returns per unit of risk. Cullen International High is currently generating about 0.24 per unit of volatility. If you would invest  1,076  in Cullen International High on December 26, 2024 and sell it today you would earn a total of  130.00  from holding Cullen International High or generate 12.08% return on investment over 90 days.

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

Atac Inflation Rotation  vs.  Cullen International High

Atac Inflation Rotation

Risk-Adjusted Performance

Very Weak

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

Cullen International High

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cullen International High are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Cullen International may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Atac Inflation and Cullen International

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

The idea behind Atac Inflation Rotation and Cullen International High 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.