Correlation Between Ross Stores and National Atomic

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

By analyzing existing cross correlation between Ross Stores and National Atomic Co, you can compare the effects of market volatilities on Ross Stores and National Atomic 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 Ross Stores with a short position of National Atomic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ross Stores and National Atomic.

Diversification Opportunities for Ross Stores and National Atomic

-0.6

Correlation Coefficient

Ross Stores  National Atomic

Excellent diversification

The 3 months correlation between Ross and National is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Ross Stores and National Atomic Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Atomic and Ross Stores 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 Ross Stores are associated (or correlated) with National Atomic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Atomic has no effect on the direction of Ross Stores i.e., Ross Stores and National Atomic go up and down completely randomly.

Pair Corralation between Ross Stores and National Atomic

Assuming the 90 days trading horizon Ross Stores is expected to under-perform the National Atomic. But the stock apears to be less risky and, when comparing its historical volatility, Ross Stores is 1.07 times less risky than National Atomic. The stock trades about -0.02 of its potential returns per unit of risk. The National Atomic Co is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest  2,847  in National Atomic Co on April 20, 2025 and sell it today you would earn a total of  1,528  from holding National Atomic Co or generate 53.67% return on investment over 90 days.

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

Ross Stores  vs.  National Atomic Co

Ross Stores

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ross Stores has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Ross Stores is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

National Atomic

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in National Atomic Co are ranked lower than 25 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, National Atomic exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ross Stores and National Atomic

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

The idea behind Ross Stores and National Atomic Co 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.