Correlation Between Atlas Consolidated and National Reinsurance

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

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

Diversification Opportunities for Atlas Consolidated and National Reinsurance

-0.01

Correlation Coefficient

Atlas Consolidated  National Reinsurance

Good diversification

The 3 months correlation between Atlas and National is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Atlas Consolidated Mining and National Reinsurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Reinsurance and Atlas Consolidated 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 Atlas Consolidated Mining are associated (or correlated) with National Reinsurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Reinsurance has no effect on the direction of Atlas Consolidated i.e., Atlas Consolidated and National Reinsurance go up and down completely randomly.

Pair Corralation between Atlas Consolidated and National Reinsurance

Assuming the 90 days trading horizon Atlas Consolidated is expected to generate 6.12 times less return on investment than National Reinsurance. But when comparing it to its historical volatility, Atlas Consolidated Mining is 1.07 times less risky than National Reinsurance. It trades about 0.01 of its potential returns per unit of risk. National Reinsurance is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  56.00  in National Reinsurance on April 22, 2025 and sell it today you would earn a total of  6.00  from holding National Reinsurance or generate 10.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.72%
Values	Daily Returns

Atlas Consolidated Mining  vs.  National Reinsurance

Atlas Consolidated Mining

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Atlas Consolidated Mining are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Atlas Consolidated is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

National Reinsurance

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in National Reinsurance are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, National Reinsurance unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Atlas Consolidated and National Reinsurance

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

The idea behind Atlas Consolidated Mining and National Reinsurance 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.