Correlation Between ATT and ASTRAZENECA
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By analyzing existing cross correlation between ATT Inc and ASTRAZENECA PLC, you can compare the effects of market volatilities on ATT and ASTRAZENECA 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 ASTRAZENECA. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and ASTRAZENECA.
Diversification Opportunities for ATT and ASTRAZENECA
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ATT and ASTRAZENECA is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding ATT Inc and ASTRAZENECA PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASTRAZENECA PLC 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 ASTRAZENECA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASTRAZENECA PLC has no effect on the direction of ATT i.e., ATT and ASTRAZENECA go up and down completely randomly.
Pair Corralation between ATT and ASTRAZENECA
Taking into account the 90-day investment horizon ATT Inc is expected to generate 1.66 times more return on investment than ASTRAZENECA. However, ATT is 1.66 times more volatile than ASTRAZENECA PLC. It trades about 0.19 of its potential returns per unit of risk. ASTRAZENECA PLC is currently generating about -0.19 per unit of risk. If you would invest 2,211 in ATT Inc on August 28, 2024 and sell it today you would earn a total of 99.00 from holding ATT Inc or generate 4.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
ATT Inc vs. ASTRAZENECA PLC
Performance |
| Timeline |
| ATT Inc |
| ASTRAZENECA PLC |
ATT and ASTRAZENECA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATT and ASTRAZENECA
The main advantage of trading using opposite ATT and ASTRAZENECA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATT position performs unexpectedly, ASTRAZENECA 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 ASTRAZENECA will offset losses from the drop in ASTRAZENECA's long position.The idea behind ATT Inc and ASTRAZENECA PLC 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.| ASTRAZENECA vs. The Coca Cola | ASTRAZENECA vs. JPMorgan Chase Co | ASTRAZENECA vs. Dupont De Nemours | ASTRAZENECA vs. Alcoa Corp |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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