Correlation Between Altice USA and ATT
Can any of the company-specific risk be diversified away by investing in both Altice USA 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 Altice USA and ATT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Altice USA and ATT Inc, you can compare the effects of market volatilities on Altice USA 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 Altice USA with a short position of ATT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altice USA and ATT.
Diversification Opportunities for Altice USA and ATT
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Altice and ATT is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Altice USA and ATT Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATT Inc and Altice USA 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 Altice USA 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 Altice USA i.e., Altice USA and ATT go up and down completely randomly.
Pair Corralation between Altice USA and ATT
Given the investment horizon of 90 days Altice USA is expected to generate 1.26 times less return on investment than ATT. In addition to that, Altice USA is 2.45 times more volatile than ATT Inc. It trades about 0.05 of its total potential returns per unit of risk. ATT Inc is currently generating about 0.17 per unit of volatility. If you would invest 2,129 in ATT Inc on August 26, 2024 and sell it today you would earn a total of 189.00 from holding ATT Inc or generate 8.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Altice USA vs. ATT Inc
Performance |
| Timeline |
| Altice USA |
| ATT Inc |
Altice USA and ATT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Altice USA and ATT
The main advantage of trading using opposite Altice USA and ATT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altice USA 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.| Altice USA vs. Liberty Broadband Srs | Altice USA vs. Cogent Communications Group | Altice USA vs. Charter Communications | Altice USA vs. Liberty Broadband Srs |
| ATT vs. Liberty Broadband Srs | ATT vs. Ribbon Communications | ATT vs. Liberty Broadband Srs | ATT vs. Shenandoah Telecommunications Co |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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