Correlation Between ATT and Perusahaan Perseroan
Can any of the company-specific risk be diversified away by investing in both ATT and Perusahaan Perseroan 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 ATT and Perusahaan Perseroan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATT Inc and Perusahaan Perseroan PT, you can compare the effects of market volatilities on ATT and Perusahaan Perseroan 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 ATT with a short position of Perusahaan Perseroan. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and Perusahaan Perseroan.
Diversification Opportunities for ATT and Perusahaan Perseroan
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ATT and Perusahaan is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding ATT Inc and Perusahaan Perseroan PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perusahaan Perseroan and ATT 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 ATT Inc are associated (or correlated) with Perusahaan Perseroan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perusahaan Perseroan has no effect on the direction of ATT i.e., ATT and Perusahaan Perseroan go up and down completely randomly.
Pair Corralation between ATT and Perusahaan Perseroan
Assuming the 90 days trading horizon ATT Inc is expected to generate 0.86 times more return on investment than Perusahaan Perseroan. However, ATT Inc is 1.16 times less risky than Perusahaan Perseroan. It trades about 0.05 of its potential returns per unit of risk. Perusahaan Perseroan PT is currently generating about -0.02 per unit of risk. If you would invest 1,558 in ATT Inc on August 25, 2024 and sell it today you would earn a total of 637.00 from holding ATT Inc or generate 40.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
ATT Inc vs. Perusahaan Perseroan PT
Performance |
| Timeline |
| ATT Inc |
| Perusahaan Perseroan |
ATT and Perusahaan Perseroan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATT and Perusahaan Perseroan
The main advantage of trading using opposite ATT and Perusahaan Perseroan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATT position performs unexpectedly, Perusahaan Perseroan 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 Perusahaan Perseroan will offset losses from the drop in Perusahaan Perseroan's long position.The idea behind ATT Inc and Perusahaan Perseroan PT 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.| Perusahaan Perseroan vs. CAREER EDUCATION | Perusahaan Perseroan vs. GREENX METALS LTD | Perusahaan Perseroan vs. Evolution Mining Limited | Perusahaan Perseroan vs. Zijin Mining 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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