Correlation Between ATT and UNITED
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By analyzing existing cross correlation between ATT Inc and UNITED PARCEL SERVICE, you can compare the effects of market volatilities on ATT and UNITED 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 UNITED. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and UNITED.
Diversification Opportunities for ATT and UNITED
Pay attention - limited upside
The 3 months correlation between ATT and UNITED is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding ATT Inc and UNITED PARCEL SERVICE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UNITED PARCEL SERVICE 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 UNITED. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UNITED PARCEL SERVICE has no effect on the direction of ATT i.e., ATT and UNITED go up and down completely randomly.
Pair Corralation between ATT and UNITED
Taking into account the 90-day investment horizon ATT Inc is expected to generate 3.48 times more return on investment than UNITED. However, ATT is 3.48 times more volatile than UNITED PARCEL SERVICE. It trades about 0.05 of its potential returns per unit of risk. UNITED PARCEL SERVICE is currently generating about 0.01 per unit of risk. If you would invest 1,703 in ATT Inc on September 2, 2024 and sell it today you would earn a total of 613.00 from holding ATT Inc or generate 36.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.4% |
| Values | Daily Returns |
ATT Inc vs. UNITED PARCEL SERVICE
Performance |
| Timeline |
| ATT Inc |
| UNITED PARCEL SERVICE |
ATT and UNITED Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATT and UNITED
The main advantage of trading using opposite ATT and UNITED positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATT position performs unexpectedly, UNITED 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 UNITED will offset losses from the drop in UNITED's long position.The idea behind ATT Inc and UNITED PARCEL SERVICE 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.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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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