Correlation Between Equinix and ALTICE

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Equinix and ALTICE 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 Equinix and ALTICE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Equinix and ALTICE FRANCE S, you can compare the effects of market volatilities on Equinix and ALTICE 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 Equinix with a short position of ALTICE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Equinix and ALTICE.

Diversification Opportunities for Equinix and ALTICE

0.62
  Correlation Coefficient

Poor diversification

The 3 months correlation between Equinix and ALTICE is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Equinix and ALTICE FRANCE S in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALTICE FRANCE S and Equinix 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 Equinix are associated (or correlated) with ALTICE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALTICE FRANCE S has no effect on the direction of Equinix i.e., Equinix and ALTICE go up and down completely randomly.

Pair Corralation between Equinix and ALTICE

Given the investment horizon of 90 days Equinix is expected to generate 0.42 times more return on investment than ALTICE. However, Equinix is 2.36 times less risky than ALTICE. It trades about 0.26 of its potential returns per unit of risk. ALTICE FRANCE S is currently generating about -0.24 per unit of risk. If you would invest  90,593  in Equinix on August 31, 2024 and sell it today you would earn a total of  7,317  from holding Equinix or generate 8.08% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy45.45%
ValuesDaily Returns

Equinix  vs.  ALTICE FRANCE S

 Performance 
       Timeline  
Equinix 

Risk-Adjusted Performance

18 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Equinix are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of fairly inconsistent forward indicators, Equinix showed solid returns over the last few months and may actually be approaching a breakup point.
ALTICE FRANCE S 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days ALTICE FRANCE S has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, ALTICE is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Equinix and ALTICE Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Equinix and ALTICE

The main advantage of trading using opposite Equinix and ALTICE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Equinix position performs unexpectedly, ALTICE 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 ALTICE will offset losses from the drop in ALTICE's long position.
The idea behind Equinix and ALTICE FRANCE S pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.

Other Complementary Tools

Commodity Directory
Find actively traded commodities issued by global exchanges
Funds Screener
Find actively-traded funds from around the world traded on over 30 global exchanges
Money Flow Index
Determine momentum by analyzing Money Flow Index and other technical indicators
Piotroski F Score
Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals
Stock Screener
Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook.