Correlation Between Astral Foods and St Jamess
Can any of the company-specific risk be diversified away by investing in both Astral Foods and St Jamess 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 Astral Foods and St Jamess into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astral Foods Limited and St Jamess Place, you can compare the effects of market volatilities on Astral Foods and St Jamess 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 Astral Foods with a short position of St Jamess. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astral Foods and St Jamess.
Diversification Opportunities for Astral Foods and St Jamess
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Astral and 1IV is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Astral Foods Limited and St Jamess Place in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on St Jamess Place and Astral Foods 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 Astral Foods Limited are associated (or correlated) with St Jamess. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of St Jamess Place has no effect on the direction of Astral Foods i.e., Astral Foods and St Jamess go up and down completely randomly.
Pair Corralation between Astral Foods and St Jamess
Assuming the 90 days trading horizon Astral Foods Limited is expected to generate 2.49 times more return on investment than St Jamess. However, Astral Foods is 2.49 times more volatile than St Jamess Place. It trades about 0.05 of its potential returns per unit of risk. St Jamess Place is currently generating about 0.0 per unit of risk. If you would invest 353.00 in Astral Foods Limited on October 25, 2024 and sell it today you would earn a total of 532.00 from holding Astral Foods Limited or generate 150.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astral Foods Limited vs. St Jamess Place
Performance |
| Timeline |
| Astral Foods Limited |
| St Jamess Place |
Astral Foods and St Jamess Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astral Foods and St Jamess
The main advantage of trading using opposite Astral Foods and St Jamess positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astral Foods position performs unexpectedly, St Jamess 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 St Jamess will offset losses from the drop in St Jamess' long position.| Astral Foods vs. Apollo Investment Corp | Astral Foods vs. Virtus Investment Partners | Astral Foods vs. CARDINAL HEALTH | Astral Foods vs. PURETECH HEALTH PLC |
| St Jamess vs. Gaztransport Technigaz SA | St Jamess vs. Iridium Communications | St Jamess vs. Texas Roadhouse | St Jamess vs. SCOTT TECHNOLOGY |
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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