Correlation Between ATMOS and SunOpta

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

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

Diversification Opportunities for ATMOS and SunOpta

-0.47

Correlation Coefficient

ATMOS  SunOpta

Very good diversification

The 3 months correlation between ATMOS and SunOpta is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding ATMOS ENERGY P and SunOpta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunOpta and ATMOS 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 ATMOS ENERGY P are associated (or correlated) with SunOpta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunOpta has no effect on the direction of ATMOS i.e., ATMOS and SunOpta go up and down completely randomly.

Pair Corralation between ATMOS and SunOpta

Assuming the 90 days trading horizon ATMOS ENERGY P is expected to under-perform the SunOpta. But the bond apears to be less risky and, when comparing its historical volatility, ATMOS ENERGY P is 2.29 times less risky than SunOpta. The bond trades about -0.23 of its potential returns per unit of risk. The SunOpta is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  756.00  in SunOpta on September 21, 2024 and sell it today you would earn a total of  17.00  from holding SunOpta or generate 2.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	81.82%
Values	Daily Returns

ATMOS ENERGY P  vs.  SunOpta

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 somewhat strong basic indicators, ATMOS is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

SunOpta

Risk-Adjusted Performance

7 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in SunOpta are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite fragile forward-looking signals, SunOpta disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ATMOS and SunOpta

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

The idea behind ATMOS ENERGY P and SunOpta 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.