Correlation Between ATT and Azure Power
Can any of the company-specific risk be diversified away by investing in both ATT and Azure Power 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 ATT and Azure Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATT Inc and Azure Power Global, you can compare the effects of market volatilities on ATT and Azure Power 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 Azure Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and Azure Power.
Diversification Opportunities for ATT and Azure Power
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ATT and Azure is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding ATT Inc and Azure Power Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Azure Power Global 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 Azure Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Azure Power Global has no effect on the direction of ATT i.e., ATT and Azure Power go up and down completely randomly.
Pair Corralation between ATT and Azure Power
Taking into account the 90-day investment horizon ATT Inc is expected to generate 0.08 times more return on investment than Azure Power. However, ATT Inc is 13.14 times less risky than Azure Power. It trades about 0.1 of its potential returns per unit of risk. Azure Power Global is currently generating about -0.2 per unit of risk. If you would invest 1,433 in ATT Inc on September 9, 2024 and sell it today you would earn a total of 955.00 from holding ATT Inc or generate 66.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 5.11% |
Values | Daily Returns |
ATT Inc vs. Azure Power Global
Performance |
Timeline |
ATT Inc |
Azure Power Global |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ATT and Azure Power Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ATT and Azure Power
The main advantage of trading using opposite ATT and Azure Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATT position performs unexpectedly, Azure Power 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 Azure Power will offset losses from the drop in Azure Power's long position.ATT vs. Cable One | ATT vs. Charter Communications | ATT vs. Liberty Broadband Srs | ATT vs. ATN International |
Azure Power vs. Altus Power | Azure Power vs. Ormat Technologies | Azure Power vs. Enlight Renewable Energy | Azure Power vs. Fluence Energy |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |