Correlation Between OceanPact Servios and ATMA Participaes

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

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

Diversification Opportunities for OceanPact Servios and ATMA Participaes

0.82

Correlation Coefficient

OceanPact Servios  ATMA Participaes

Very poor diversification

The 3 months correlation between OceanPact and ATMA is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding OceanPact Servios Martimos and ATMA Participaes SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATMA Participaes and OceanPact Servios 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 OceanPact Servios Martimos are associated (or correlated) with ATMA Participaes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATMA Participaes has no effect on the direction of OceanPact Servios i.e., OceanPact Servios and ATMA Participaes go up and down completely randomly.

Pair Corralation between OceanPact Servios and ATMA Participaes

Assuming the 90 days trading horizon OceanPact Servios Martimos is expected to under-perform the ATMA Participaes. But the stock apears to be less risky and, when comparing its historical volatility, OceanPact Servios Martimos is 2.12 times less risky than ATMA Participaes. The stock trades about -0.19 of its potential returns per unit of risk. The ATMA Participaes SA is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest  139.00  in ATMA Participaes SA on September 15, 2024 and sell it today you would lose (20.00) from holding ATMA Participaes SA or give up 14.39% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.44%
Values	Daily Returns

OceanPact Servios Martimos  vs.  ATMA Participaes SA

OceanPact Servios

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days OceanPact Servios Martimos has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

ATMA Participaes

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ATMA Participaes SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with OceanPact Servios and ATMA Participaes

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

The idea behind OceanPact Servios Martimos and ATMA Participaes 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.