Correlation Between SinterCast and ATT
Can any of the company-specific risk be diversified away by investing in both SinterCast and ATT 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 SinterCast and ATT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SinterCast AB and ATT Inc, you can compare the effects of market volatilities on SinterCast and ATT 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 SinterCast with a short position of ATT. Check out your portfolio center. Please also check ongoing floating volatility patterns of SinterCast and ATT.
Diversification Opportunities for SinterCast and ATT
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SinterCast and ATT is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SinterCast AB and ATT Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATT Inc and SinterCast 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 SinterCast AB are associated (or correlated) with ATT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATT Inc has no effect on the direction of SinterCast i.e., SinterCast and ATT go up and down completely randomly.
Pair Corralation between SinterCast and ATT
Assuming the 90 days trading horizon SinterCast AB is expected to generate 1.05 times more return on investment than ATT. However, SinterCast is 1.05 times more volatile than ATT Inc. It trades about 0.13 of its potential returns per unit of risk. ATT Inc is currently generating about 0.0 per unit of risk. If you would invest 10,000 in SinterCast AB on January 25, 2024 and sell it today you would earn a total of 300.00 from holding SinterCast AB or generate 3.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 95.45% |
Values | Daily Returns |
SinterCast AB vs. ATT Inc
Performance |
Timeline |
SinterCast AB |
ATT Inc |
SinterCast and ATT Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SinterCast and ATT
The main advantage of trading using opposite SinterCast and ATT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SinterCast position performs unexpectedly, ATT 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 ATT will offset losses from the drop in ATT's long position.SinterCast vs. AB SKF | SinterCast vs. Alfa Laval AB | SinterCast vs. Atlas Copco AB | SinterCast vs. Boliden AB |
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 the Transaction History module to view history of all your transactions and understand their impact on performance.
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