Pair Correlation Between ATT and Verizon Communications

This module allows you to analyze existing cross correlation between ATT Inc and Verizon Communications Inc. You can compare the effects of market volatilities on ATT and Verizon Communications 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 ATT with a short position of Verizon Communications. See also your portfolio center. Please also check ongoing floating volatility patterns of ATT and Verizon Communications.
Investment Horizon     30 Days    Login   to change
Symbolsvs
 ATT Inc  vs   Verizon Communications Inc
 Performance (%) 
      Timeline 

Pair Volatility

Taking into account the 30 trading days horizon, ATT Inc is expected to under-perform the Verizon Communications. In addition to that, ATT is 2.0 times more volatile than Verizon Communications Inc. It trades about -0.31 of its total potential returns per unit of risk. Verizon Communications Inc is currently generating about -0.1 per unit of volatility. If you would invest  4,990  in Verizon Communications Inc on September 23, 2017 and sell it today you would lose (82)  from holding Verizon Communications Inc or give up 1.64% of portfolio value over 30 days.

Correlation Coefficient

Pair Corralation between ATT and Verizon Communications
0.71

Parameters

Time Period1 Month [change]
DirectionPositive 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Diversification

Poor diversification

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

Comparative Volatility

 Predicted Return Density 
      Returns 

ATT Inc

  
0 

Risk-Adjusted Performance

Over the last 30 days ATT Inc has generated negative risk-adjusted returns adding no value to investors with long positions.

Verizon Communications

  
0 

Risk-Adjusted Performance

Over the last 30 days Verizon Communications Inc has generated negative risk-adjusted returns adding no value to investors with long positions.