Correlation Between Cartier Resources and Atlas Corp

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Can any of the company-specific risk be diversified away by investing in both Cartier Resources and Atlas Corp 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 Cartier Resources and Atlas Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cartier Resources and Atlas Corp, you can compare the effects of market volatilities on Cartier Resources and Atlas Corp 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 Cartier Resources with a short position of Atlas Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cartier Resources and Atlas Corp.

Diversification Opportunities for Cartier Resources and Atlas Corp

CartierAtlasDiversified AwayCartierAtlasDiversified Away100%
0.08
  Correlation Coefficient

Significant diversification

The 3 months correlation between Cartier and Atlas is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Cartier Resources and Atlas Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlas Corp and Cartier Resources 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 Cartier Resources are associated (or correlated) with Atlas Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlas Corp has no effect on the direction of Cartier Resources i.e., Cartier Resources and Atlas Corp go up and down completely randomly.

Pair Corralation between Cartier Resources and Atlas Corp

Assuming the 90 days horizon Cartier Resources is expected to generate 43.3 times more return on investment than Atlas Corp. However, Cartier Resources is 43.3 times more volatile than Atlas Corp. It trades about 0.09 of its potential returns per unit of risk. Atlas Corp is currently generating about 0.15 per unit of risk. If you would invest  7.00  in Cartier Resources on November 24, 2024 and sell it today you would earn a total of  2.00  from holding Cartier Resources or generate 28.57% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Cartier Resources  vs.  Atlas Corp

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -30-20-10010
JavaScript chart by amCharts 3.21.15ECRFF ATCOL
       Timeline  
Cartier Resources 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Cartier Resources are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile technical and fundamental indicators, Cartier Resources reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb0.050.060.070.080.090.1
Atlas Corp 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Atlas Corp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Atlas Corp is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb24.524.624.724.824.92525.125.2

Cartier Resources and Atlas Corp Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-35.6-26.66-17.72-8.790.09.0518.4227.7837.1546.51 12345
JavaScript chart by amCharts 3.21.15ECRFF ATCOL
       Returns  

Pair Trading with Cartier Resources and Atlas Corp

The main advantage of trading using opposite Cartier Resources and Atlas Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cartier Resources position performs unexpectedly, Atlas Corp 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 Atlas Corp will offset losses from the drop in Atlas Corp's long position.
The idea behind Cartier Resources and Atlas Corp 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.

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