Adtran Inc Stock Volatility

ADTN Stock  USD 6.13  0.04  0.66%   
ADTRAN appears to be slightly risky, given 3 months investment horizon. ADTRAN Inc secures Sharpe Ratio (or Efficiency) of 0.16, which signifies that the company had a 0.16% return per unit of risk over the last 3 months. By reviewing ADTRAN's technical indicators, you can evaluate if the expected return of 0.53% is justified by implied risk. Please makes use of ADTRAN's mean deviation of 2.3, and Risk Adjusted Performance of 0.1002 to double-check if our risk estimates are consistent with your expectations. Key indicators related to ADTRAN's volatility include:
30 Days Market Risk
Chance Of Distress
30 Days Economic Sensitivity
ADTRAN Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of ADTRAN daily returns, and it is calculated using variance and standard deviation. We also use ADTRAN's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of ADTRAN volatility.

ESG Sustainability

While most ESG disclosures are voluntary, ADTRAN's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to ADTRAN's managers and investors.
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as ADTRAN can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of ADTRAN at lower prices. For example, an investor can purchase ADTRAN stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of ADTRAN's stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.

Moving together with ADTRAN Stock

  0.87KN Knowles CorPairCorr
  0.61HPQ HP Inc Fiscal Year End 19th of November 2024 PairCorr

Moving against ADTRAN Stock

  0.65OPTX Syntec Optics Holdings Symbol ChangePairCorr
  0.62KULR KULR Technology GroupPairCorr
  0.43IMTE Integrated Media TecPairCorr
  0.34AVNW Aviat Networks Fiscal Year End 28th of August 2024 PairCorr

ADTRAN Market Sensitivity And Downside Risk

ADTRAN's beta coefficient measures the volatility of ADTRAN stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents ADTRAN stock's returns against your selected market. In other words, ADTRAN's beta of 0.97 provides an investor with an approximation of how much risk ADTRAN stock can potentially add to one of your existing portfolios. ADTRAN Inc currently demonstrates below-average downside deviation. It has Information Ratio of 0.12 and Jensen Alpha of 0.39. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure ADTRAN's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact ADTRAN's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze ADTRAN Inc Demand Trend
Check current 90 days ADTRAN correlation with market (Dow Jones Industrial)


ADTRAN standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

It is essential to understand the difference between upside risk (as represented by ADTRAN's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of ADTRAN's daily returns or price. Since the actual investment returns on holding a position in adtran stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in ADTRAN.

Using ADTRAN Put Option to Manage Risk

Put options written on ADTRAN grant holders of the option the right to sell a specified amount of ADTRAN at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of ADTRAN Stock cannot fall below zero, the put buyer does gain as the price drops. So, one way investors can hedge ADTRAN's position is by buying a put option against it. The put option used this way is usually referred to as insurance. If an undesired outcome occurs and loss on holding ADTRAN will be realized, the loss incurred will be offset by the profits made with the option trade.

ADTRAN's PUT expiring on 2024-08-16

       ADTRAN Price At Expiration  

ADTRAN Inc Stock Volatility Analysis

Volatility refers to the frequency at which ADTRAN stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with ADTRAN's price changes. Investors will then calculate the volatility of ADTRAN's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of ADTRAN's volatility:

Historical Volatility

This type of stock volatility measures ADTRAN's fluctuations based on previous trends. It's commonly used to predict ADTRAN's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for ADTRAN's current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on ADTRAN's to be redeemed at a future date.
The output start index for this execution was zero with a total number of output elements of sixty-one. ADTRAN Inc Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.

ADTRAN Projected Return Density Against Market

Given the investment horizon of 90 days ADTRAN has a beta of 0.9686 . This suggests ADTRAN Inc market returns are highly reactive to returns on the market. As the market goes up or down, ADTRAN is expected to follow.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to ADTRAN or Communications Equipment sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that ADTRAN's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a ADTRAN stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
ADTRAN Inc has an alpha of 0.3854, implying that it can generate a 0.39 percent excess return over Dow Jones Industrial after adjusting for the inherited market risk (beta).
   Predicted Return Density   
ADTRAN's volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how adtran stock's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives an ADTRAN Price Volatility?

Several factors can influence a stock's market volatility:


Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

ADTRAN Stock Risk Measures

Given the investment horizon of 90 days the coefficient of variation of ADTRAN is 631.85. The daily returns are distributed with a variance of 11.14 and standard deviation of 3.34. The mean deviation of ADTRAN Inc is currently at 2.35. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.66
Alpha over Dow Jones
Beta against Dow Jones0.97
Overall volatility
Information ratio 0.12

ADTRAN Stock Return Volatility

ADTRAN historical daily return volatility represents how much of ADTRAN stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The firm inherits 3.3376% risk (volatility on return distribution) over the 90 days horizon. By contrast, Dow Jones Industrial accepts 0.6587% volatility on return distribution over the 90 days horizon.

About ADTRAN Volatility

Volatility is a rate at which the price of ADTRAN or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of ADTRAN may increase or decrease. In other words, similar to ADTRAN's beta indicator, it measures the risk of ADTRAN and helps estimate the fluctuations that may happen in a short period of time. So if prices of ADTRAN fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
Last ReportedProjected for Next Year
Market Cap1.1 BB
ADTRAN's stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on ADTRAN Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much ADTRAN's price varies over time.

3 ways to utilize ADTRAN's volatility to invest better

Higher ADTRAN's stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of ADTRAN Inc stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. ADTRAN Inc stock volatility can provide helpful information for making investment decisions in the following ways:
  • Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of ADTRAN Inc investment. A higher volatility means higher risk and potentially larger changes in value.
  • Identifying Opportunities: High volatility in ADTRAN's stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
  • Diversification: Understanding how the volatility of ADTRAN's stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Remember it's essential to remember that stock volatility is just one of many factors to consider when making investment decisions, and it should be used in conjunction with other fundamental and technical analysis tools.

ADTRAN Investment Opportunity

ADTRAN Inc has a volatility of 3.34 and is 5.06 times more volatile than Dow Jones Industrial. 29 percent of all equities and portfolios are less risky than ADTRAN. You can use ADTRAN Inc to enhance the returns of your portfolios. The stock experiences a moderate upward volatility. Check odds of ADTRAN to be traded at $6.74 in 90 days.

Average diversification

The correlation between ADTRAN Inc and DJI is 0.19 (i.e., Average diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding ADTRAN Inc and DJI in the same portfolio, assuming nothing else is changed.

ADTRAN Additional Risk Indicators

The analysis of ADTRAN's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in ADTRAN's investment and either accepting that risk or mitigating it. Along with some common measures of ADTRAN stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

ADTRAN Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against ADTRAN as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. ADTRAN's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, ADTRAN's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to ADTRAN Inc.

Additional Information and Resources on Investing in ADTRAN Stock

When determining whether ADTRAN Inc offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of ADTRAN's financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Adtran Inc Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Adtran Inc Stock:
Check out Trending Equities to better understand how to build diversified portfolios, which includes a position in ADTRAN Inc. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in estimate.
You can also try the Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Is Communications Equipment space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of ADTRAN. If investors know ADTRAN will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about ADTRAN listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
Dividend Share
Earnings Share
Revenue Per Share
Quarterly Revenue Growth
The market value of ADTRAN Inc is measured differently than its book value, which is the value of ADTRAN that is recorded on the company's balance sheet. Investors also form their own opinion of ADTRAN's value that differs from its market value or its book value, called intrinsic value, which is ADTRAN's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because ADTRAN's market value can be influenced by many factors that don't directly affect ADTRAN's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between ADTRAN's value and its price as these two are different measures arrived at by different means. Investors typically determine if ADTRAN is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, ADTRAN's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.