Correlation Between Zumiez and Atlas Financial

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

By analyzing existing cross correlation between Zumiez Inc and Atlas Financial Holdings, you can compare the effects of market volatilities on Zumiez and Atlas Financial 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 Zumiez with a short position of Atlas Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zumiez and Atlas Financial.

Diversification Opportunities for Zumiez and Atlas Financial

0.0

Correlation Coefficient

Zumiez  Atlas Financial

Pay attention - limited upside

The 3 months correlation between Zumiez and Atlas is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Zumiez Inc and Atlas Financial Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlas Financial Holdings and Zumiez 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 Zumiez Inc are associated (or correlated) with Atlas Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlas Financial Holdings has no effect on the direction of Zumiez i.e., Zumiez and Atlas Financial go up and down completely randomly.

Pair Corralation between Zumiez and Atlas Financial

If you would invest (100.00) in Atlas Financial Holdings on September 25, 2024 and sell it today you would earn a total of  100.00  from holding Atlas Financial Holdings or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Zumiez Inc  vs.  Atlas Financial Holdings

Zumiez Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Zumiez Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's primary indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Atlas Financial Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Atlas Financial Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical and fundamental indicators, Atlas Financial is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Zumiez and Atlas Financial

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

The idea behind Zumiez Inc and Atlas Financial Holdings 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.