Correlation Between Biomm SA and Atom Empreendimentos

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

By analyzing existing cross correlation between Biomm SA and Atom Empreendimentos e, you can compare the effects of market volatilities on Biomm SA and Atom Empreendimentos 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 Biomm SA with a short position of Atom Empreendimentos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Biomm SA and Atom Empreendimentos.

Diversification Opportunities for Biomm SA and Atom Empreendimentos

-0.63

Correlation Coefficient

Biomm SA  Atom Empreendimentos

Excellent diversification

The 3 months correlation between Biomm and Atom is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Biomm SA and Atom Empreendimentos e in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atom Empreendimentos and Biomm SA 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 Biomm SA are associated (or correlated) with Atom Empreendimentos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atom Empreendimentos has no effect on the direction of Biomm SA i.e., Biomm SA and Atom Empreendimentos go up and down completely randomly.

Pair Corralation between Biomm SA and Atom Empreendimentos

Assuming the 90 days trading horizon Biomm SA is expected to under-perform the Atom Empreendimentos. But the stock apears to be less risky and, when comparing its historical volatility, Biomm SA is 3.4 times less risky than Atom Empreendimentos. The stock trades about -0.07 of its potential returns per unit of risk. The Atom Empreendimentos e is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  215.00  in Atom Empreendimentos e on September 12, 2024 and sell it today you would earn a total of  170.00  from holding Atom Empreendimentos e or generate 79.07% return on investment over 90 days.

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

Biomm SA  vs.  Atom Empreendimentos e

Biomm SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Biomm SA 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.

Atom Empreendimentos

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Atom Empreendimentos e are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Atom Empreendimentos unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Biomm SA and Atom Empreendimentos

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

The idea behind Biomm SA and Atom Empreendimentos e 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.

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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.