Correlation Between Intevac and ADTRAN
Can any of the company-specific risk be diversified away by investing in both Intevac and ADTRAN 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 Intevac and ADTRAN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intevac and ADTRAN Inc, you can compare the effects of market volatilities on Intevac and ADTRAN 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 Intevac with a short position of ADTRAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intevac and ADTRAN.
Diversification Opportunities for Intevac and ADTRAN
Pay attention - limited upside
The 3 months correlation between Intevac and ADTRAN is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Intevac and ADTRAN Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADTRAN Inc and Intevac 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 Intevac are associated (or correlated) with ADTRAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADTRAN Inc has no effect on the direction of Intevac i.e., Intevac and ADTRAN go up and down completely randomly.
Pair Corralation between Intevac and ADTRAN
Given the investment horizon of 90 days Intevac is expected to under-perform the ADTRAN. In addition to that, Intevac is 1.03 times more volatile than ADTRAN Inc. It trades about -0.08 of its total potential returns per unit of risk. ADTRAN Inc is currently generating about 0.22 per unit of volatility. If you would invest 539.00 in ADTRAN Inc on September 2, 2024 and sell it today you would earn a total of 311.00 from holding ADTRAN Inc or generate 57.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intevac vs. ADTRAN Inc
Performance |
| Timeline |
| Intevac |
| ADTRAN Inc |
Intevac and ADTRAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intevac and ADTRAN
The main advantage of trading using opposite Intevac and ADTRAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intevac position performs unexpectedly, ADTRAN 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 ADTRAN will offset losses from the drop in ADTRAN's long position.| Intevac vs. Innovative Solutions and | Intevac vs. Heidrick Struggles International | Intevac vs. ICF International | Intevac vs. PDF Solutions |
| ADTRAN vs. Mynaric AG ADR | ADTRAN vs. KVH Industries | ADTRAN vs. Telesat Corp | ADTRAN vs. Digi International |
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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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