Correlation Between Afcon Holdings and ATT
Can any of the company-specific risk be diversified away by investing in both Afcon Holdings and ATT 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 Afcon Holdings and ATT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Afcon Holdings and ATT Inc, you can compare the effects of market volatilities on Afcon Holdings and ATT 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 Afcon Holdings with a short position of ATT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Afcon Holdings and ATT.
Diversification Opportunities for Afcon Holdings and ATT
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Afcon and ATT is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Afcon Holdings and ATT Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATT Inc and Afcon Holdings 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 Afcon Holdings are associated (or correlated) with ATT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATT Inc has no effect on the direction of Afcon Holdings i.e., Afcon Holdings and ATT go up and down completely randomly.
Pair Corralation between Afcon Holdings and ATT
Assuming the 90 days trading horizon Afcon Holdings is expected to generate 1.55 times more return on investment than ATT. However, Afcon Holdings is 1.55 times more volatile than ATT Inc. It trades about 0.01 of its potential returns per unit of risk. ATT Inc is currently generating about 0.0 per unit of risk. If you would invest 935,000 in Afcon Holdings on January 19, 2024 and sell it today you would earn a total of 1,000.00 from holding Afcon Holdings or generate 0.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 80.32% |
| Values | Daily Returns |
Afcon Holdings vs. ATT Inc
Performance |
| Timeline |
| Afcon Holdings |
| ATT Inc |
Afcon Holdings and ATT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Afcon Holdings and ATT
The main advantage of trading using opposite Afcon Holdings and ATT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Afcon Holdings position performs unexpectedly, ATT 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 ATT will offset losses from the drop in ATT's long position.| Afcon Holdings vs. EN Shoham Business | Afcon Holdings vs. Accel Solutions Group | Afcon Holdings vs. Mivtach Shamir | Afcon Holdings vs. Rani Zim Shopping |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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