Correlation Between FG Annuities and Atlantic American

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Can any of the company-specific risk be diversified away by investing in both FG Annuities and Atlantic American 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 FG Annuities and Atlantic American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FG Annuities Life and Atlantic American, you can compare the effects of market volatilities on FG Annuities and Atlantic American 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 FG Annuities with a short position of Atlantic American. Check out your portfolio center. Please also check ongoing floating volatility patterns of FG Annuities and Atlantic American.

Diversification Opportunities for FG Annuities and Atlantic American

-0.28
  Correlation Coefficient

Very good diversification

The 3 months correlation between FG Annuities and Atlantic is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding FG Annuities Life and Atlantic American in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlantic American and FG Annuities 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 FG Annuities Life are associated (or correlated) with Atlantic American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlantic American has no effect on the direction of FG Annuities i.e., FG Annuities and Atlantic American go up and down completely randomly.

Pair Corralation between FG Annuities and Atlantic American

Allowing for the 90-day total investment horizon FG Annuities is expected to generate 1.95 times less return on investment than Atlantic American. But when comparing it to its historical volatility, FG Annuities Life is 1.08 times less risky than Atlantic American. It trades about 0.03 of its potential returns per unit of risk. Atlantic American is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  143.00  in Atlantic American on September 20, 2024 and sell it today you would earn a total of  12.00  from holding Atlantic American or generate 8.39% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

FG Annuities Life  vs.  Atlantic American

 Performance 
       Timeline  
FG Annuities Life 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Very Weak
Compared to the overall equity markets, risk-adjusted returns on investments in FG Annuities Life are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical and fundamental indicators, FG Annuities is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.
Atlantic American 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Very Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Atlantic American are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak primary indicators, Atlantic American may actually be approaching a critical reversion point that can send shares even higher in January 2025.

FG Annuities and Atlantic American Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with FG Annuities and Atlantic American

The main advantage of trading using opposite FG Annuities and Atlantic American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FG Annuities position performs unexpectedly, Atlantic American 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 Atlantic American will offset losses from the drop in Atlantic American's long position.
The idea behind FG Annuities Life and Atlantic American 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..

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