Correlation Between Faraday Future and ATT

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Faraday Future 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 Faraday Future and ATT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Faraday Future Intelligent and ATT Inc, you can compare the effects of market volatilities on Faraday Future 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 Faraday Future with a short position of ATT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Faraday Future and ATT.

Diversification Opportunities for Faraday Future and ATT

-0.54
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Faraday and ATT is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Faraday Future Intelligent and ATT Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATT Inc and Faraday Future 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 Faraday Future Intelligent 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 Faraday Future i.e., Faraday Future and ATT go up and down completely randomly.

Pair Corralation between Faraday Future and ATT

Given the investment horizon of 90 days Faraday Future Intelligent is expected to under-perform the ATT. In addition to that, Faraday Future is 7.25 times more volatile than ATT Inc. It trades about -0.16 of its total potential returns per unit of risk. ATT Inc is currently generating about 0.01 per unit of volatility. If you would invest  1,756  in ATT Inc on December 29, 2023 and sell it today you would lose (1.00) from holding ATT Inc or give up 0.06% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Faraday Future Intelligent  vs.  ATT Inc

 Performance 
       Timeline  
Faraday Future Intel 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Faraday Future Intelligent 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 forward indicators remain rather sound which may send shares a bit higher in April 2024. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.
ATT Inc 

Risk-Adjusted Performance

6 of 100

 
Low
 
High
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in ATT Inc are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, ATT may actually be approaching a critical reversion point that can send shares even higher in April 2024.

Faraday Future and ATT Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Faraday Future and ATT

The main advantage of trading using opposite Faraday Future and ATT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Faraday Future 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.
The idea behind Faraday Future Intelligent and ATT Inc 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.
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.

Other Complementary Tools

Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
Watchlist Optimization
Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Top Crypto Exchanges
Search and analyze digital assets across top global cryptocurrency exchanges
Economic Indicators
Top statistical indicators that provide insights into how an economy is performing
Theme Ratings
Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance
AI Investment Finder
Use AI to screen and filter profitable investment opportunities
Price Ceiling Movement
Calculate and plot Price Ceiling Movement for different equity instruments