Correlation Between Visteon Corp and Altimar Acquisition

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

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

Diversification Opportunities for Visteon Corp and Altimar Acquisition

-0.15

Correlation Coefficient

Visteon Corp  Altimar Acquisition

Good diversification

The 3 months correlation between Visteon and Altimar is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Visteon Corp and Altimar Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altimar Acquisition Corp and Visteon Corp 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 Visteon Corp are associated (or correlated) with Altimar Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altimar Acquisition Corp has no effect on the direction of Visteon Corp i.e., Visteon Corp and Altimar Acquisition go up and down completely randomly.

Pair Corralation between Visteon Corp and Altimar Acquisition

If you would invest  5.00  in Altimar Acquisition Corp on October 6, 2024 and sell it today you would earn a total of  0.00  from holding Altimar Acquisition Corp or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.61%
Values	Daily Returns

Visteon Corp  vs.  Altimar Acquisition Corp

Visteon Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Visteon Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound fundamental indicators, Visteon Corp is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Altimar Acquisition Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Altimar Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Altimar Acquisition is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Visteon Corp and Altimar Acquisition

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

The idea behind Visteon Corp and Altimar Acquisition 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.