Correlation Between Hurco Companies and ATMOS

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

By analyzing existing cross correlation between Hurco Companies and ATMOS ENERGY P, you can compare the effects of market volatilities on Hurco Companies and ATMOS 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 Hurco Companies with a short position of ATMOS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hurco Companies and ATMOS.

Diversification Opportunities for Hurco Companies and ATMOS

0.07

Correlation Coefficient

Hurco Companies  ATMOS

Significant diversification

The 3 months correlation between Hurco and ATMOS is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Hurco Companies and ATMOS ENERGY P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATMOS ENERGY P and Hurco Companies 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 Hurco Companies are associated (or correlated) with ATMOS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATMOS ENERGY P has no effect on the direction of Hurco Companies i.e., Hurco Companies and ATMOS go up and down completely randomly.

Pair Corralation between Hurco Companies and ATMOS

Given the investment horizon of 90 days Hurco Companies is expected to generate 2.08 times more return on investment than ATMOS. However, Hurco Companies is 2.08 times more volatile than ATMOS ENERGY P. It trades about -0.06 of its potential returns per unit of risk. ATMOS ENERGY P is currently generating about -0.13 per unit of risk. If you would invest  2,107  in Hurco Companies on September 29, 2024 and sell it today you would lose (199.00) from holding Hurco Companies or give up 9.44% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	49.21%
Values	Daily Returns

Hurco Companies  vs.  ATMOS ENERGY P

Hurco Companies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hurco Companies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

ATMOS ENERGY P

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ATMOS ENERGY P has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for ATMOS ENERGY P investors.

Pair Trading with Hurco Companies and ATMOS

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

The idea behind Hurco Companies and ATMOS ENERGY P 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.