Correlation Between UTG and Atlantic American

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

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

Diversification Opportunities for UTG and Atlantic American

-0.38

Correlation Coefficient

UTG  Atlantic American

Very good diversification

The 3 months correlation between UTG and Atlantic is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding UTG Inc and Atlantic American in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlantic American and UTG 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 UTG Inc 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 UTG i.e., UTG and Atlantic American go up and down completely randomly.

Pair Corralation between UTG and Atlantic American

If you would invest  2,960  in UTG Inc on September 20, 2024 and sell it today you would earn a total of  0.00  from holding UTG Inc or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	0.4%
Values	Daily Returns

UTG Inc  vs.  Atlantic American

UTG Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days UTG Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, UTG is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Atlantic American

Risk-Adjusted Performance

4 of 100

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.

Pair Trading with UTG and Atlantic American

The main advantage of trading using opposite UTG and Atlantic American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UTG 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 UTG Inc 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.