Correlation Between Allegheny Technologies and ATRESMEDIA
Can any of the company-specific risk be diversified away by investing in both Allegheny Technologies and ATRESMEDIA 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 Allegheny Technologies and ATRESMEDIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Allegheny Technologies Incorporated and ATRESMEDIA, you can compare the effects of market volatilities on Allegheny Technologies and ATRESMEDIA 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 Allegheny Technologies with a short position of ATRESMEDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allegheny Technologies and ATRESMEDIA.
Diversification Opportunities for Allegheny Technologies and ATRESMEDIA
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Allegheny and ATRESMEDIA is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Allegheny Technologies Incorpo and ATRESMEDIA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATRESMEDIA and Allegheny 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 Allegheny Technologies Incorporated are associated (or correlated) with ATRESMEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATRESMEDIA has no effect on the direction of Allegheny Technologies i.e., Allegheny Technologies and ATRESMEDIA go up and down completely randomly.
Pair Corralation between Allegheny Technologies and ATRESMEDIA
Assuming the 90 days trading horizon Allegheny Technologies Incorporated is expected to generate 1.68 times more return on investment than ATRESMEDIA. However, Allegheny Technologies is 1.68 times more volatile than ATRESMEDIA. It trades about 0.05 of its potential returns per unit of risk. ATRESMEDIA is currently generating about 0.08 per unit of risk. If you would invest 3,620 in Allegheny Technologies Incorporated on November 5, 2024 and sell it today you would earn a total of 1,948 from holding Allegheny Technologies Incorporated or generate 53.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allegheny Technologies Incorpo vs. ATRESMEDIA
Performance |
| Timeline |
| Allegheny Technologies |
| ATRESMEDIA |
Allegheny Technologies and ATRESMEDIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allegheny Technologies and ATRESMEDIA
The main advantage of trading using opposite Allegheny Technologies and ATRESMEDIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allegheny Technologies position performs unexpectedly, ATRESMEDIA 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 ATRESMEDIA will offset losses from the drop in ATRESMEDIA's long position.| Allegheny Technologies vs. SILVER BULLET DATA | Allegheny Technologies vs. Information Services International Dentsu | Allegheny Technologies vs. Virtu Financial | Allegheny Technologies vs. MICRONIC MYDATA |
| ATRESMEDIA vs. United Insurance Holdings | ATRESMEDIA vs. SENECA FOODS A | ATRESMEDIA vs. UNIQA INSURANCE GR | ATRESMEDIA vs. Insurance Australia Group |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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