Correlation Between ATT and AUTOMATIC
Specify exactly 2 symbols:
By analyzing existing cross correlation between ATT Inc and AUTOMATIC DATA PROCESSING, you can compare the effects of market volatilities on ATT and AUTOMATIC 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 AUTOMATIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and AUTOMATIC.
Diversification Opportunities for ATT and AUTOMATIC
Pay attention - limited upside
The 3 months correlation between ATT and AUTOMATIC is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding ATT Inc and AUTOMATIC DATA PROCESSING in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AUTOMATIC DATA PROCESSING 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 AUTOMATIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AUTOMATIC DATA PROCESSING has no effect on the direction of ATT i.e., ATT and AUTOMATIC go up and down completely randomly.
Pair Corralation between ATT and AUTOMATIC
Taking into account the 90-day investment horizon ATT Inc is expected to generate 0.72 times more return on investment than AUTOMATIC. However, ATT Inc is 1.38 times less risky than AUTOMATIC. It trades about 0.18 of its potential returns per unit of risk. AUTOMATIC DATA PROCESSING is currently generating about -0.17 per unit of risk. If you would invest 2,192 in ATT Inc on September 4, 2024 and sell it today you would earn a total of 78.00 from holding ATT Inc or generate 3.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ATT Inc vs. AUTOMATIC DATA PROCESSING
Performance |
| Timeline |
| ATT Inc |
| AUTOMATIC DATA PROCESSING |
ATT and AUTOMATIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATT and AUTOMATIC
The main advantage of trading using opposite ATT and AUTOMATIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATT position performs unexpectedly, AUTOMATIC 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 AUTOMATIC will offset losses from the drop in AUTOMATIC's long position.The idea behind ATT Inc and AUTOMATIC DATA PROCESSING 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.| AUTOMATIC vs. AEP TEX INC | AUTOMATIC vs. US BANK NATIONAL | AUTOMATIC vs. Jackson Financial | AUTOMATIC vs. MetLife |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |