Correlation Between Atos SE and SHOPRITE HDGS
Can any of the company-specific risk be diversified away by investing in both Atos SE and SHOPRITE HDGS 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 Atos SE and SHOPRITE HDGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atos SE and SHOPRITE HDGS ADR, you can compare the effects of market volatilities on Atos SE and SHOPRITE HDGS 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 Atos SE with a short position of SHOPRITE HDGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atos SE and SHOPRITE HDGS.
Diversification Opportunities for Atos SE and SHOPRITE HDGS
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Atos and SHOPRITE is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Atos SE and SHOPRITE HDGS ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SHOPRITE HDGS ADR and Atos SE 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 Atos SE are associated (or correlated) with SHOPRITE HDGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SHOPRITE HDGS ADR has no effect on the direction of Atos SE i.e., Atos SE and SHOPRITE HDGS go up and down completely randomly.
Pair Corralation between Atos SE and SHOPRITE HDGS
Assuming the 90 days horizon Atos SE is expected to generate 19.69 times more return on investment than SHOPRITE HDGS. However, Atos SE is 19.69 times more volatile than SHOPRITE HDGS ADR. It trades about 0.03 of its potential returns per unit of risk. SHOPRITE HDGS ADR is currently generating about 0.03 per unit of risk. If you would invest 1,074 in Atos SE on September 23, 2024 and sell it today you would lose (1,074) from holding Atos SE or give up 99.98% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Atos SE vs. SHOPRITE HDGS ADR
Performance |
Timeline |
Atos SE |
SHOPRITE HDGS ADR |
Atos SE and SHOPRITE HDGS Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Atos SE and SHOPRITE HDGS
The main advantage of trading using opposite Atos SE and SHOPRITE HDGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atos SE position performs unexpectedly, SHOPRITE HDGS 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 SHOPRITE HDGS will offset losses from the drop in SHOPRITE HDGS's long position.Atos SE vs. Accenture plc | Atos SE vs. International Business Machines | Atos SE vs. Infosys Limited | Atos SE vs. Cognizant Technology Solutions |
SHOPRITE HDGS vs. Martin Marietta Materials | SHOPRITE HDGS vs. Heidelberg Materials AG | SHOPRITE HDGS vs. The Yokohama Rubber | SHOPRITE HDGS vs. Applied Materials |
Check out your portfolio center.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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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