Correlation Between ATT and Innovator Capital
Can any of the company-specific risk be diversified away by investing in both ATT and Innovator Capital 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 Innovator Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATT Inc and Innovator Capital Management, you can compare the effects of market volatilities on ATT and Innovator Capital 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 Innovator Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and Innovator Capital.
Diversification Opportunities for ATT and Innovator Capital
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between ATT and Innovator is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding ATT Inc and Innovator Capital Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Innovator Capital 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 Innovator Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Innovator Capital has no effect on the direction of ATT i.e., ATT and Innovator Capital go up and down completely randomly.
Pair Corralation between ATT and Innovator Capital
Taking into account the 90-day investment horizon ATT Inc is expected to generate 3.46 times more return on investment than Innovator Capital. However, ATT is 3.46 times more volatile than Innovator Capital Management. It trades about 0.05 of its potential returns per unit of risk. Innovator Capital Management is currently generating about 0.16 per unit of risk. If you would invest 1,688 in ATT Inc on September 3, 2024 and sell it today you would earn a total of 628.00 from holding ATT Inc or generate 37.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 30.71% |
| Values | Daily Returns |
ATT Inc vs. Innovator Capital Management
Performance |
| Timeline |
| ATT Inc |
| Innovator Capital |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ATT and Innovator Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATT and Innovator Capital
The main advantage of trading using opposite ATT and Innovator Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATT position performs unexpectedly, Innovator Capital 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 Innovator Capital will offset losses from the drop in Innovator Capital's long position.| ATT vs. Highway Holdings Limited | ATT vs. QCR Holdings | ATT vs. Partner Communications | ATT vs. Acumen Pharmaceuticals |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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