Correlation Between Aptitude Software and Tatton Asset

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

By analyzing existing cross correlation between Aptitude Software Group and Tatton Asset Management, you can compare the effects of market volatilities on Aptitude Software and Tatton Asset 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 Aptitude Software with a short position of Tatton Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aptitude Software and Tatton Asset.

Diversification Opportunities for Aptitude Software and Tatton Asset

0.59

Correlation Coefficient

Aptitude Software  Tatton Asset

Very weak diversification

The 3 months correlation between Aptitude and Tatton is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Aptitude Software Group and Tatton Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tatton Asset Management and Aptitude Software 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 Aptitude Software Group are associated (or correlated) with Tatton Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tatton Asset Management has no effect on the direction of Aptitude Software i.e., Aptitude Software and Tatton Asset go up and down completely randomly.

Pair Corralation between Aptitude Software and Tatton Asset

Assuming the 90 days trading horizon Aptitude Software is expected to generate 2.31 times less return on investment than Tatton Asset. In addition to that, Aptitude Software is 1.32 times more volatile than Tatton Asset Management. It trades about 0.05 of its total potential returns per unit of risk. Tatton Asset Management is currently generating about 0.15 per unit of volatility. If you would invest  59,164  in Tatton Asset Management on April 25, 2025 and sell it today you would earn a total of  10,436  from holding Tatton Asset Management or generate 17.64% return on investment over 90 days.

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

Aptitude Software Group  vs.  Tatton Asset Management

Aptitude Software

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Aptitude Software Group are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Aptitude Software may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Tatton Asset Management

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Tatton Asset Management are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Tatton Asset exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aptitude Software and Tatton Asset

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

The idea behind Aptitude Software Group and Tatton Asset Management 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.