Correlation Between Agilent Technologies and ATT
Can any of the company-specific risk be diversified away by investing in both Agilent Technologies 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 Agilent Technologies and ATT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agilent Technologies and ATT Inc, you can compare the effects of market volatilities on Agilent Technologies 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 Agilent Technologies with a short position of ATT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agilent Technologies and ATT.
Diversification Opportunities for Agilent Technologies and ATT
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Agilent and ATT is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Agilent Technologies and ATT Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATT Inc and Agilent Technologies 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 Agilent Technologies 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 Agilent Technologies i.e., Agilent Technologies and ATT go up and down completely randomly.
Pair Corralation between Agilent Technologies and ATT
Taking into account the 90-day investment horizon Agilent Technologies is expected to under-perform the ATT. In addition to that, Agilent Technologies is 1.11 times more volatile than ATT Inc. It trades about -0.01 of its total potential returns per unit of risk. ATT Inc is currently generating about 0.05 per unit of volatility. If you would invest 1,655 in ATT Inc on August 26, 2024 and sell it today you would earn a total of 663.00 from holding ATT Inc or generate 40.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agilent Technologies vs. ATT Inc
Performance |
| Timeline |
| Agilent Technologies |
| ATT Inc |
Agilent Technologies and ATT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agilent Technologies and ATT
The main advantage of trading using opposite Agilent Technologies and ATT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agilent Technologies 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.| Agilent Technologies vs. Danaher | Agilent Technologies vs. Illumina | Agilent Technologies vs. IDEXX Laboratories | Agilent Technologies vs. Waters |
| ATT vs. Cogent Communications Group | ATT vs. Liberty Broadband Srs | ATT vs. Ribbon Communications | ATT vs. Liberty Broadband Srs |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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