Correlation Between Marex Group and ATIF Holdings

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

By analyzing existing cross correlation between Marex Group plc and ATIF Holdings Limited, you can compare the effects of market volatilities on Marex Group and ATIF Holdings 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 Marex Group with a short position of ATIF Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marex Group and ATIF Holdings.

Diversification Opportunities for Marex Group and ATIF Holdings

-0.52

Correlation Coefficient

Marex Group  ATIF Holdings

Excellent diversification

The 3 months correlation between Marex and ATIF is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Marex Group plc and ATIF Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATIF Holdings Limited and Marex Group 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 Marex Group plc are associated (or correlated) with ATIF Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATIF Holdings Limited has no effect on the direction of Marex Group i.e., Marex Group and ATIF Holdings go up and down completely randomly.

Pair Corralation between Marex Group and ATIF Holdings

Considering the 90-day investment horizon Marex Group plc is expected to generate 0.69 times more return on investment than ATIF Holdings. However, Marex Group plc is 1.44 times less risky than ATIF Holdings. It trades about 0.1 of its potential returns per unit of risk. ATIF Holdings Limited is currently generating about 0.0 per unit of risk. If you would invest  3,778  in Marex Group plc on February 17, 2025 and sell it today you would earn a total of  750.00  from holding Marex Group plc or generate 19.85% return on investment over 90 days.

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

Marex Group plc  vs.  ATIF Holdings Limited

Marex Group plc

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Marex Group plc are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unsteady basic indicators, Marex Group showed solid returns over the last few months and may actually be approaching a breakup point.

ATIF Holdings Limited

Risk-Adjusted Performance

Very Weak

Over the last 90 days ATIF Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, ATIF Holdings is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with Marex Group and ATIF Holdings

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

The idea behind Marex Group plc and ATIF Holdings Limited 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.