Correlation Between Mattel and Alpha Technology

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

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

Diversification Opportunities for Mattel and Alpha Technology

0.4

Correlation Coefficient

Mattel  Alpha Technology

Very weak diversification

The 3 months correlation between Mattel and Alpha is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Mattel Inc and Alpha Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alpha Technology and Mattel 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 Mattel Inc are associated (or correlated) with Alpha Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alpha Technology has no effect on the direction of Mattel i.e., Mattel and Alpha Technology go up and down completely randomly.

Pair Corralation between Mattel and Alpha Technology

Considering the 90-day investment horizon Mattel Inc is expected to generate 0.7 times more return on investment than Alpha Technology. However, Mattel Inc is 1.43 times less risky than Alpha Technology. It trades about -0.05 of its potential returns per unit of risk. Alpha Technology Group is currently generating about -0.14 per unit of risk. If you would invest  1,983  in Mattel Inc on May 20, 2025 and sell it today you would lose (188.00) from holding Mattel Inc or give up 9.48% of portfolio value over 90 days.

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

Mattel Inc  vs.  Alpha Technology Group

Mattel Inc

Risk-Adjusted Performance

Weakest

Over the last 90 days Mattel Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Alpha Technology

Risk-Adjusted Performance

Weakest

Over the last 90 days Alpha Technology Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical and fundamental indicators remain quite persistent which may send shares a bit higher in September 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Mattel and Alpha Technology

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

The idea behind Mattel Inc and Alpha Technology Group 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..