Correlation Between ATT and KeyCorp
Can any of the company-specific risk be diversified away by investing in both ATT and KeyCorp 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 KeyCorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ATT Inc and KeyCorp, you can compare the effects of market volatilities on ATT and KeyCorp 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 KeyCorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of ATT and KeyCorp.
Diversification Opportunities for ATT and KeyCorp
Excellent diversification
The 3 months correlation between ATT and KeyCorp is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding ATT Inc and KeyCorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KeyCorp 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 KeyCorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KeyCorp has no effect on the direction of ATT i.e., ATT and KeyCorp go up and down completely randomly.
Pair Corralation between ATT and KeyCorp
Taking into account the 90-day investment horizon ATT Inc is expected to under-perform the KeyCorp. In addition to that, ATT is 3.53 times more volatile than KeyCorp. It trades about -0.15 of its total potential returns per unit of risk. KeyCorp is currently generating about 0.13 per unit of volatility. If you would invest 2,458 in KeyCorp on August 15, 2025 and sell it today you would earn a total of 73.00 from holding KeyCorp or generate 2.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ATT Inc vs. KeyCorp
Performance |
| Timeline |
| ATT Inc |
| KeyCorp |
ATT and KeyCorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ATT and KeyCorp
The main advantage of trading using opposite ATT and KeyCorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ATT position performs unexpectedly, KeyCorp 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 KeyCorp will offset losses from the drop in KeyCorp's long position.The idea behind ATT Inc and KeyCorp 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.| KeyCorp vs. Truist Financial Corp | KeyCorp vs. Huntington Bancshares Incorporated | KeyCorp vs. Fifth Third Bancorp | KeyCorp vs. US Bancorp |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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