Correlation Between Investin Optimal and ATT
Can any of the company-specific risk be diversified away by investing in both Investin Optimal 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 Investin Optimal and ATT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Investin Optimal VerdensIndex and ATT Inc, you can compare the effects of market volatilities on Investin Optimal 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 Investin Optimal with a short position of ATT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Investin Optimal and ATT.
Diversification Opportunities for Investin Optimal and ATT
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Investin and ATT is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Investin Optimal VerdensIndex and ATT Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATT Inc and Investin Optimal 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 Investin Optimal VerdensIndex 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 Investin Optimal i.e., Investin Optimal and ATT go up and down completely randomly.
Pair Corralation between Investin Optimal and ATT
Assuming the 90 days trading horizon Investin Optimal VerdensIndex is expected to generate 0.27 times more return on investment than ATT. However, Investin Optimal VerdensIndex is 3.7 times less risky than ATT. It trades about 0.06 of its potential returns per unit of risk. ATT Inc is currently generating about -0.01 per unit of risk. If you would invest 18,265 in Investin Optimal VerdensIndex on January 19, 2024 and sell it today you would earn a total of 2,277 from holding Investin Optimal VerdensIndex or generate 12.47% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 99.34% |
Values | Daily Returns |
Investin Optimal VerdensIndex vs. ATT Inc
Performance |
Timeline |
Investin Optimal Ver |
ATT Inc |
Investin Optimal and ATT Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Investin Optimal and ATT
The main advantage of trading using opposite Investin Optimal and ATT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Investin Optimal 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.Investin Optimal vs. Novo Nordisk AS | Investin Optimal vs. Nordea Bank Abp | Investin Optimal vs. DSV Panalpina AS | Investin Optimal vs. AP Mller |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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