Correlation Between Triton International and ATAI Life

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

Diversification Opportunities for Triton International and ATAI Life

-0.11
  Correlation Coefficient

Good diversification

The 3 months correlation between Triton and ATAI Life is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Triton International Group 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 Triton International 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 Triton International Group 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 Triton International i.e., Triton International and ATAI Life go up and down completely randomly.

Pair Corralation between Triton International and ATAI Life

Given the investment horizon of 90 days Triton International Group is expected to generate 0.36 times more return on investment than ATAI Life. However, Triton International Group is 2.76 times less risky than ATAI Life. It trades about 0.1 of its potential returns per unit of risk. ATAI Life Sciences is currently generating about -0.07 per unit of risk. If you would invest  6,195  in Triton International Group on September 11, 2022 and sell it today you would earn a total of  675.00  from holding Triton International Group or generate 10.9% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Triton International Group  vs.  ATAI Life Sciences

 Performance (%) 
       Timeline  
Triton International 
Triton Performance
7 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Triton International Group are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Triton International may actually be approaching a critical reversion point that can send shares even higher in January 2023.

Triton 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 unsteady performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2023. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

ATAI Life Price Channel

Triton International and ATAI Life Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Triton International and ATAI Life

The main advantage of trading using opposite Triton International and ATAI Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Triton International 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 Triton International Group 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 Probability Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.

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