Correlation Between F PD and ATT

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

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

Diversification Opportunities for F PD and ATT

0.92

Correlation Coefficient

F PD  ATT

Almost no diversification

The 3 months correlation between F-PD and ATT is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding F PD and ATT Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATT Inc and F PD 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 F PD 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 F PD i.e., F PD and ATT go up and down completely randomly.

Pair Corralation between F PD and ATT

Given the investment horizon of 90 days F PD is expected to generate 0.98 times more return on investment than ATT. However, F PD is 1.02 times less risky than ATT. It trades about 0.29 of its potential returns per unit of risk. ATT Inc is currently generating about 0.15 per unit of risk. If you would invest  2,120  in F PD on May 17, 2025 and sell it today you would earn a total of  253.00  from holding F PD or generate 11.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

F PD  vs.  ATT Inc

F PD

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in F PD are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, F PD may actually be approaching a critical reversion point that can send shares even higher in September 2025.

ATT Inc

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ATT Inc are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental drivers, ATT is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with F PD and ATT

The main advantage of trading using opposite F PD and ATT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if F PD 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.

The idea behind F PD and ATT Inc 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 Global Correlations module to find global opportunities by holding instruments from different markets.