Correlation Between Teliasonera and Atai Life

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Can any of the company-specific risk be diversified away by investing in both Teliasonera and Atai Life 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 Teliasonera and Atai Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Teliasonera Ab Ord and Atai Life Sciences, you can compare the effects of market volatilities on Teliasonera and Atai Life 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 Teliasonera with a short position of Atai Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Teliasonera and Atai Life.

Diversification Opportunities for Teliasonera and Atai Life

0.9
  Correlation Coefficient

Almost no diversification

The 3 months correlation between Teliasonera and Atai Life is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Teliasonera Ab Ord and Atai Life Sciences in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atai Life Sciences and Teliasonera 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 Teliasonera Ab Ord are associated (or correlated) with Atai Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atai Life Sciences has no effect on the direction of Teliasonera i.e., Teliasonera and Atai Life go up and down completely randomly.

Pair Corralation between Teliasonera and Atai Life

Assuming the 90 days horizon Teliasonera Ab Ord is expected to under-perform the Atai Life. But the otc stock apears to be less risky and, when comparing its historical volatility, Teliasonera Ab Ord is 1.9 times less risky than Atai Life. The otc stock trades about -0.1 of its potential returns per unit of risk. The Atai Life Sciences is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest  325.00  in Atai Life Sciences on August 30, 2022 and sell it today you would lose (25.00)  from holding Atai Life Sciences or give up 7.69% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Strong
Accuracy97.67%
ValuesDaily Returns

Teliasonera Ab Ord  vs.  Atai Life Sciences

 Performance (%) 
       Timeline  
Teliasonera Ab Ord 
Teliasonera Performance
0 of 100
Over the last 90 days Teliasonera Ab Ord has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in December 2022. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Teliasonera Price Channel

Atai Life Sciences 
Atai Life Performance
0 of 100
Over the last 90 days Atai Life Sciences has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in December 2022. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Atai Life Price Channel

Teliasonera and Atai Life Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Teliasonera and Atai Life

The main advantage of trading using opposite Teliasonera and Atai Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Teliasonera position performs unexpectedly, Atai Life 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 Atai Life will offset losses from the drop in Atai Life's long position.
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The idea behind Teliasonera Ab Ord and Atai Life Sciences 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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Check out your portfolio center. 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.

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