Correlation Between Global Ferronickel and Atok Big

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

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

Diversification Opportunities for Global Ferronickel and Atok Big

-0.07

Correlation Coefficient

Global Ferronickel  Atok Big

Good diversification

The 3 months correlation between Global and Atok is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Global Ferronickel Holdings and Atok Big Wedge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atok Big Wedge and Global Ferronickel 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 Global Ferronickel Holdings are associated (or correlated) with Atok Big. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atok Big Wedge has no effect on the direction of Global Ferronickel i.e., Global Ferronickel and Atok Big go up and down completely randomly.

Pair Corralation between Global Ferronickel and Atok Big

Assuming the 90 days trading horizon Global Ferronickel Holdings is expected to generate 0.51 times more return on investment than Atok Big. However, Global Ferronickel Holdings is 1.96 times less risky than Atok Big. It trades about 0.07 of its potential returns per unit of risk. Atok Big Wedge is currently generating about 0.02 per unit of risk. If you would invest  104.00  in Global Ferronickel Holdings on December 26, 2024 and sell it today you would earn a total of  8.00  from holding Global Ferronickel Holdings or generate 7.69% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	93.44%
Values	Daily Returns

Global Ferronickel Holdings  vs.  Atok Big Wedge

Global Ferronickel

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Global Ferronickel Holdings are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Global Ferronickel may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Atok Big Wedge

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Atok Big Wedge are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Atok Big is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Global Ferronickel and Atok Big

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

The idea behind Global Ferronickel Holdings and Atok Big Wedge 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.