Correlation Between Astral Foods and Townsquare Media
Can any of the company-specific risk be diversified away by investing in both Astral Foods and Townsquare Media 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 Townsquare Media 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 Townsquare Media, you can compare the effects of market volatilities on Astral Foods and Townsquare Media 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 Townsquare Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astral Foods and Townsquare Media.
Diversification Opportunities for Astral Foods and Townsquare Media
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Astral and Townsquare is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Astral Foods Limited and Townsquare Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Townsquare Media 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 Townsquare Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Townsquare Media has no effect on the direction of Astral Foods i.e., Astral Foods and Townsquare Media go up and down completely randomly.
Pair Corralation between Astral Foods and Townsquare Media
Assuming the 90 days trading horizon Astral Foods Limited is expected to generate 3.83 times more return on investment than Townsquare Media. However, Astral Foods is 3.83 times more volatile than Townsquare Media. It trades about 0.03 of its potential returns per unit of risk. Townsquare Media is currently generating about 0.05 per unit of risk. If you would invest 905.00 in Astral Foods Limited on August 28, 2024 and sell it today you would earn a total of 40.00 from holding Astral Foods Limited or generate 4.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astral Foods Limited vs. Townsquare Media
Performance |
| Timeline |
| Astral Foods Limited |
| Townsquare Media |
Astral Foods and Townsquare Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astral Foods and Townsquare Media
The main advantage of trading using opposite Astral Foods and Townsquare Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astral Foods position performs unexpectedly, Townsquare Media 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 Townsquare Media will offset losses from the drop in Townsquare Media's long position.| Astral Foods vs. Superior Plus Corp | Astral Foods vs. NMI Holdings | Astral Foods vs. Origin Agritech | Astral Foods vs. SIVERS SEMICONDUCTORS AB |
| Townsquare Media vs. Xtrackers ShortDAX | Townsquare Media vs. Lyxor 1 | Townsquare Media vs. Xtrackers LevDAX |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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