Correlation Between ATT and Goliath Film
Can any of the company-specific risk be diversified away by investing in both ATT and Goliath Film 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 Goliath Film into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATT Inc and Goliath Film and, you can compare the effects of market volatilities on ATT and Goliath Film 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 Goliath Film. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and Goliath Film.
Diversification Opportunities for ATT and Goliath Film
-0.92 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ATT and Goliath is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding ATT Inc and Goliath Film and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goliath Film 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 Goliath Film. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goliath Film has no effect on the direction of ATT i.e., ATT and Goliath Film go up and down completely randomly.
Pair Corralation between ATT and Goliath Film
Taking into account the 90-day investment horizon ATT Inc is expected to generate 0.43 times more return on investment than Goliath Film. However, ATT Inc is 2.31 times less risky than Goliath Film. It trades about 0.22 of its potential returns per unit of risk. Goliath Film and is currently generating about -0.26 per unit of risk. If you would invest 2,211 in ATT Inc on August 29, 2024 and sell it today you would earn a total of 116.00 from holding ATT Inc or generate 5.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ATT Inc vs. Goliath Film and
Performance |
| Timeline |
| ATT Inc |
| Goliath Film |
ATT and Goliath Film Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATT and Goliath Film
The main advantage of trading using opposite ATT and Goliath Film positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATT position performs unexpectedly, Goliath Film 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 Goliath Film will offset losses from the drop in Goliath Film's long position.The idea behind ATT Inc and Goliath Film and 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.| Goliath Film vs. Bank Rakyat | Goliath Film vs. PT Bank Rakyat | Goliath Film vs. Samsung Electronics Co | Goliath Film vs. Bank Mandiri Persero |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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