Correlation Between Castellum and Atos Origin

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

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

Diversification Opportunities for Castellum and Atos Origin

-0.76

Correlation Coefficient

Castellum  Atos Origin

Pay attention - limited upside

The 3 months correlation between Castellum and Atos is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Castellum and Atos Origin SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atos Origin SA and Castellum 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 Castellum are associated (or correlated) with Atos Origin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atos Origin SA has no effect on the direction of Castellum i.e., Castellum and Atos Origin go up and down completely randomly.

Pair Corralation between Castellum and Atos Origin

Considering the 90-day investment horizon Castellum is expected to generate 1.85 times more return on investment than Atos Origin. However, Castellum is 1.85 times more volatile than Atos Origin SA. It trades about 0.25 of its potential returns per unit of risk. Atos Origin SA is currently generating about -0.33 per unit of risk. If you would invest  43.00  in Castellum on October 23, 2024 and sell it today you would earn a total of  66.00  from holding Castellum or generate 153.49% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	94.74%
Values	Daily Returns

Castellum  vs.  Atos Origin SA

Castellum

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Castellum are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of very inconsistent basic indicators, Castellum displayed solid returns over the last few months and may actually be approaching a breakup point.

Atos Origin SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Atos Origin SA 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 basic indicators remain fairly strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with Castellum and Atos Origin

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

The idea behind Castellum and Atos Origin 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.