Correlation Between American Tower and Uniti
Can any of the company-specific risk be diversified away by investing in both American Tower and Uniti 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 American Tower and Uniti into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Tower Corp and Uniti Group, you can compare the effects of market volatilities on American Tower and Uniti 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 American Tower with a short position of Uniti. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Tower and Uniti.
Diversification Opportunities for American Tower and Uniti
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between American and Uniti is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding American Tower Corp and Uniti Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uniti Group and American Tower 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 American Tower Corp are associated (or correlated) with Uniti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uniti Group has no effect on the direction of American Tower i.e., American Tower and Uniti go up and down completely randomly.
Pair Corralation between American Tower and Uniti
Considering the 90-day investment horizon American Tower is expected to generate 13.15 times less return on investment than Uniti. But when comparing it to its historical volatility, American Tower Corp is 2.53 times less risky than Uniti. It trades about 0.01 of its potential returns per unit of risk. Uniti Group is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 525.00 in Uniti Group on August 27, 2024 and sell it today you would earn a total of 86.00 from holding Uniti Group or generate 16.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
American Tower Corp vs. Uniti Group
Performance |
| Timeline |
| American Tower Corp |
| Uniti Group |
American Tower and Uniti Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Tower and Uniti
The main advantage of trading using opposite American Tower and Uniti positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Tower position performs unexpectedly, Uniti 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 Uniti will offset losses from the drop in Uniti's long position.| American Tower vs. Digital Realty Trust | American Tower vs. Equinix | American Tower vs. SBA Communications Corp | American Tower vs. Iron Mountain Incorporated |
| Uniti vs. Digital Realty Trust | Uniti vs. Iron Mountain Incorporated | Uniti vs. Gaming Leisure Properties | Uniti vs. Crown Castle |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |