Correlation Between ATT and Veeco Instrument

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Can any of the company-specific risk be diversified away by investing in both ATT and Veeco Instrument 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 Veeco Instrument into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATT Inc and Veeco Instrument, you can compare the effects of market volatilities on ATT and Veeco Instrument 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 Veeco Instrument. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and Veeco Instrument.

Diversification Opportunities for ATT and Veeco Instrument

-0.39
  Correlation Coefficient

Very good diversification

The 3 months correlation between ATT and Veeco is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding ATT Inc and Veeco Instrument in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Veeco Instrument 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 Veeco Instrument. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Veeco Instrument has no effect on the direction of ATT i.e., ATT and Veeco Instrument go up and down completely randomly.

Pair Corralation between ATT and Veeco Instrument

Taking into account the 90-day investment horizon ATT Inc is expected to under-perform the Veeco Instrument. But the stock apears to be less risky and, when comparing its historical volatility, ATT Inc is 1.68 times less risky than Veeco Instrument. The stock trades about -0.06 of its potential returns per unit of risk. The Veeco Instrument is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  1,942  in Veeco Instrument on May 15, 2022 and sell it today you would earn a total of  382.00  from holding Veeco Instrument or generate 19.67% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

ATT Inc  vs.  Veeco Instrument

 Performance (%) 
       Timeline  
ATT Inc 
ATT Performance
0 of 100
Over the last 90 days ATT Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest sluggish 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.

ATT Price Channel

Veeco Instrument 
Veeco Performance
3 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Veeco Instrument are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite quite sluggish fundamental indicators, Veeco Instrument may actually be approaching a critical reversion point that can send shares even higher in September 2022.

Veeco Price Channel

ATT and Veeco Instrument Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with ATT and Veeco Instrument

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

Veeco Instrument

Pair trading matchups for Veeco Instrument

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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.

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