Correlation Between AAC TECHNOLOGHLDGADR and Allegheny Technologies
Can any of the company-specific risk be diversified away by investing in both AAC TECHNOLOGHLDGADR and Allegheny Technologies 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 AAC TECHNOLOGHLDGADR and Allegheny Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AAC TECHNOLOGHLDGADR and Allegheny Technologies Incorporated, you can compare the effects of market volatilities on AAC TECHNOLOGHLDGADR and Allegheny Technologies 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 AAC TECHNOLOGHLDGADR with a short position of Allegheny Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of AAC TECHNOLOGHLDGADR and Allegheny Technologies.
Diversification Opportunities for AAC TECHNOLOGHLDGADR and Allegheny Technologies
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between AAC and Allegheny is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding AAC TECHNOLOGHLDGADR and Allegheny Technologies Incorpo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allegheny Technologies and AAC TECHNOLOGHLDGADR 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 AAC TECHNOLOGHLDGADR are associated (or correlated) with Allegheny Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allegheny Technologies has no effect on the direction of AAC TECHNOLOGHLDGADR i.e., AAC TECHNOLOGHLDGADR and Allegheny Technologies go up and down completely randomly.
Pair Corralation between AAC TECHNOLOGHLDGADR and Allegheny Technologies
Assuming the 90 days horizon AAC TECHNOLOGHLDGADR is expected to generate 1.67 times more return on investment than Allegheny Technologies. However, AAC TECHNOLOGHLDGADR is 1.67 times more volatile than Allegheny Technologies Incorporated. It trades about 0.14 of its potential returns per unit of risk. Allegheny Technologies Incorporated is currently generating about 0.01 per unit of risk. If you would invest 284.00 in AAC TECHNOLOGHLDGADR on November 3, 2024 and sell it today you would earn a total of 190.00 from holding AAC TECHNOLOGHLDGADR or generate 66.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AAC TECHNOLOGHLDGADR vs. Allegheny Technologies Incorpo
Performance |
| Timeline |
| AAC TECHNOLOGHLDGADR |
| Allegheny Technologies |
AAC TECHNOLOGHLDGADR and Allegheny Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AAC TECHNOLOGHLDGADR and Allegheny Technologies
The main advantage of trading using opposite AAC TECHNOLOGHLDGADR and Allegheny Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AAC TECHNOLOGHLDGADR position performs unexpectedly, Allegheny Technologies 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 Allegheny Technologies will offset losses from the drop in Allegheny Technologies' long position.| AAC TECHNOLOGHLDGADR vs. MARKET VECTR RETAIL | AAC TECHNOLOGHLDGADR vs. Caseys General Stores | AAC TECHNOLOGHLDGADR vs. National Retail Properties | AAC TECHNOLOGHLDGADR vs. Northern Data AG |
| Allegheny Technologies vs. Apple Inc | Allegheny Technologies vs. Apple Inc | Allegheny Technologies vs. Apple Inc | Allegheny Technologies vs. Apple Inc |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |