Correlation Between IHS Holding and ATN International

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

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

Diversification Opportunities for IHS Holding and ATN International

0.68

Correlation Coefficient

IHS Holding  ATN International

Poor diversification

The 3 months correlation between IHS and ATN is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding IHS Holding and ATN International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATN International and IHS Holding 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 IHS Holding are associated (or correlated) with ATN International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATN International has no effect on the direction of IHS Holding i.e., IHS Holding and ATN International go up and down completely randomly.

Pair Corralation between IHS Holding and ATN International

Considering the 90-day investment horizon IHS Holding is expected to generate 1.31 times more return on investment than ATN International. However, IHS Holding is 1.31 times more volatile than ATN International. It trades about 0.27 of its potential returns per unit of risk. ATN International is currently generating about 0.15 per unit of risk. If you would invest  297.00  in IHS Holding on December 26, 2024 and sell it today you would earn a total of  238.00  from holding IHS Holding or generate 80.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

IHS Holding  vs.  ATN International

IHS Holding

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in IHS Holding are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent technical indicators, IHS Holding unveiled solid returns over the last few months and may actually be approaching a breakup point.

ATN International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ATN International are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly inconsistent basic indicators, ATN International demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with IHS Holding and ATN International

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

The idea behind IHS Holding and ATN International 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.