Correlation Between Atos SE and Liveramp Holdings
Can any of the company-specific risk be diversified away by investing in both Atos SE and Liveramp Holdings 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 Atos SE and Liveramp Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Atos SE and Liveramp Holdings, you can compare the effects of market volatilities on Atos SE and Liveramp Holdings 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 Atos SE with a short position of Liveramp Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Atos SE and Liveramp Holdings.
Diversification Opportunities for Atos SE and Liveramp Holdings
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Atos and Liveramp is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Atos SE and Liveramp Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liveramp Holdings and Atos SE 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 Atos SE are associated (or correlated) with Liveramp Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liveramp Holdings has no effect on the direction of Atos SE i.e., Atos SE and Liveramp Holdings go up and down completely randomly.
Pair Corralation between Atos SE and Liveramp Holdings
Assuming the 90 days horizon Atos SE is expected to generate 4.12 times more return on investment than Liveramp Holdings. However, Atos SE is 4.12 times more volatile than Liveramp Holdings. It trades about 0.12 of its potential returns per unit of risk. Liveramp Holdings is currently generating about -0.06 per unit of risk. If you would invest 186.00 in Atos SE on January 26, 2024 and sell it today you would earn a total of 28.00 from holding Atos SE or generate 15.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Atos SE vs. Liveramp Holdings
Performance |
| Timeline |
| Atos SE |
| Liveramp Holdings |
Atos SE and Liveramp Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Atos SE and Liveramp Holdings
The main advantage of trading using opposite Atos SE and Liveramp Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Atos SE position performs unexpectedly, Liveramp Holdings 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 Liveramp Holdings will offset losses from the drop in Liveramp Holdings' long position.The idea behind Atos SE and Liveramp 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.| Liveramp Holdings vs. PagSeguro Digital | Liveramp Holdings vs. Endava | Liveramp Holdings vs. Nutanix | Liveramp Holdings vs. Yext Inc |
Check out your portfolio center.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 Stocks Directory module to find actively traded stocks across global markets.
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