Correlation Between Blue Water and Atento SA

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

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

Diversification Opportunities for Blue Water and Atento SA

0.38

Correlation Coefficient

Blue Water  Atento SA

Weak diversification

The 3 months correlation between Blue and Atento is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Blue Water Ventures and Atento SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atento SA and Blue Water 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 Blue Water Ventures are associated (or correlated) with Atento SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atento SA has no effect on the direction of Blue Water i.e., Blue Water and Atento SA go up and down completely randomly.

Pair Corralation between Blue Water and Atento SA

If you would invest  47.00  in Atento SA on September 5, 2024 and sell it today you would earn a total of  0.00  from holding Atento SA or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	1.56%
Values	Daily Returns

Blue Water Ventures  vs.  Atento SA

Blue Water Ventures

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blue Water Ventures has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in January 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Atento SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Atento SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Atento SA is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Blue Water and Atento SA

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

The idea behind Blue Water Ventures and Atento SA 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.