Correlation Between ATIF Holdings and Katapult Holdings

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

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

Diversification Opportunities for ATIF Holdings and Katapult Holdings

0.63

Correlation Coefficient

ATIF Holdings  Katapult Holdings

Poor diversification

The 3 months correlation between ATIF and Katapult is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding ATIF Holdings and Katapult Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Katapult Holdings and ATIF Holdings 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 ATIF Holdings are associated (or correlated) with Katapult Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Katapult Holdings has no effect on the direction of ATIF Holdings i.e., ATIF Holdings and Katapult Holdings go up and down completely randomly.

Pair Corralation between ATIF Holdings and Katapult Holdings

Given the investment horizon of 90 days ATIF Holdings is expected to generate 1.36 times more return on investment than Katapult Holdings. However, ATIF Holdings is 1.36 times more volatile than Katapult Holdings. It trades about -0.03 of its potential returns per unit of risk. Katapult Holdings is currently generating about -0.08 per unit of risk. If you would invest  81.00  in ATIF Holdings on September 5, 2024 and sell it today you would lose (10.00) from holding ATIF Holdings or give up 12.35% of portfolio value over 90 days.

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

ATIF Holdings  vs.  Katapult Holdings

ATIF Holdings

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ATIF Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain forward indicators, ATIF Holdings reported solid returns over the last few months and may actually be approaching a breakup point.

Katapult Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with ATIF Holdings and Katapult Holdings

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

The idea behind ATIF Holdings and Katapult 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.