Correlation Between Altice USA and Harmonic

Can any of the company-specific risk be diversified away by investing in both Altice USA and Harmonic 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 Altice USA and Harmonic into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Altice USA and Harmonic, you can compare the effects of market volatilities on Altice USA and Harmonic 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 Altice USA with a short position of Harmonic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Altice USA and Harmonic.

Diversification Opportunities for Altice USA and Harmonic

-0.09

Correlation Coefficient

Altice USA  Harmonic

Good diversification

The 3 months correlation between Altice and Harmonic is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Altice USA and Harmonic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harmonic and Altice USA 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 Altice USA are associated (or correlated) with Harmonic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harmonic has no effect on the direction of Altice USA i.e., Altice USA and Harmonic go up and down completely randomly.

Pair Corralation between Altice USA and Harmonic

Given the investment horizon of 90 days Altice USA is expected to generate 1.74 times more return on investment than Harmonic. However, Altice USA is 1.74 times more volatile than Harmonic. It trades about 0.01 of its potential returns per unit of risk. Harmonic is currently generating about -0.03 per unit of risk. If you would invest  253.00  in Altice USA on May 4, 2025 and sell it today you would lose (6.00) from holding Altice USA or give up 2.37% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Altice USA  vs.  Harmonic

Altice USA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Altice USA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Altice USA is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Harmonic

Risk-Adjusted Performance

Very Weak

Over the last 90 days Harmonic has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward indicators, Harmonic is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Altice USA and Harmonic

The main advantage of trading using opposite Altice USA and Harmonic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Altice USA position performs unexpectedly, Harmonic 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 Harmonic will offset losses from the drop in Harmonic's long position.

The idea behind Altice USA and Harmonic 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.

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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.