Correlation Between ATT and SUMITOMO
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By analyzing existing cross correlation between ATT Inc and SUMITOMO MITSUI FINANCIAL, you can compare the effects of market volatilities on ATT and SUMITOMO 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 SUMITOMO. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and SUMITOMO.
Diversification Opportunities for ATT and SUMITOMO
Modest diversification
The 3 months correlation between ATT and SUMITOMO is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding ATT Inc and SUMITOMO MITSUI FINANCIAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUMITOMO MITSUI FINANCIAL 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 SUMITOMO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUMITOMO MITSUI FINANCIAL has no effect on the direction of ATT i.e., ATT and SUMITOMO go up and down completely randomly.
Pair Corralation between ATT and SUMITOMO
Taking into account the 90-day investment horizon ATT Inc is expected to generate 1.03 times more return on investment than SUMITOMO. However, ATT is 1.03 times more volatile than SUMITOMO MITSUI FINANCIAL. It trades about 0.25 of its potential returns per unit of risk. SUMITOMO MITSUI FINANCIAL is currently generating about -0.13 per unit of risk. If you would invest 2,241 in ATT Inc on December 2, 2024 and sell it today you would earn a total of 500.00 from holding ATT Inc or generate 22.31% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 80.33% |
Values | Daily Returns |
ATT Inc vs. SUMITOMO MITSUI FINANCIAL
Performance |
Timeline |
ATT Inc |
SUMITOMO MITSUI FINANCIAL |
ATT and SUMITOMO Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with ATT and SUMITOMO
The main advantage of trading using opposite ATT and SUMITOMO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATT position performs unexpectedly, SUMITOMO 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 SUMITOMO will offset losses from the drop in SUMITOMO's long position.The idea behind ATT Inc and SUMITOMO MITSUI FINANCIAL 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.SUMITOMO vs. Exchange Bank | SUMITOMO vs. SBM Offshore NV | SUMITOMO vs. Barings BDC | SUMITOMO vs. Mesa Air Group |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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