Correlation Between ATT and Bridgemarq Real

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

By analyzing existing cross correlation between ATT Inc and Bridgemarq Real Estate, you can compare the effects of market volatilities on ATT and Bridgemarq Real 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 Bridgemarq Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and Bridgemarq Real.

Diversification Opportunities for ATT and Bridgemarq Real

0.62

Correlation Coefficient

ATT  Bridgemarq Real

Poor diversification

The 3 months correlation between ATT and Bridgemarq is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding ATT Inc and Bridgemarq Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bridgemarq Real Estate 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 Bridgemarq Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bridgemarq Real Estate has no effect on the direction of ATT i.e., ATT and Bridgemarq Real go up and down completely randomly.

Pair Corralation between ATT and Bridgemarq Real

Taking into account the 90-day investment horizon ATT Inc is expected to generate 0.97 times more return on investment than Bridgemarq Real. However, ATT Inc is 1.04 times less risky than Bridgemarq Real. It trades about 0.12 of its potential returns per unit of risk. Bridgemarq Real Estate is currently generating about 0.04 per unit of risk. If you would invest  2,132  in ATT Inc on September 12, 2024 and sell it today you would earn a total of  219.00  from holding ATT Inc or generate 10.27% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	90.63%
Values	Daily Returns

ATT Inc  vs.  Bridgemarq Real Estate

ATT Inc

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ATT Inc are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, ATT may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Bridgemarq Real Estate

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Bridgemarq Real Estate are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Bridgemarq Real is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with ATT and Bridgemarq Real

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

The idea behind ATT Inc and Bridgemarq Real Estate 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.