Correlation Between Astral Foods and MidCap Financial
Can any of the company-specific risk be diversified away by investing in both Astral Foods and MidCap Financial 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 MidCap Financial 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 MidCap Financial Investment, you can compare the effects of market volatilities on Astral Foods and MidCap Financial 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 MidCap Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astral Foods and MidCap Financial.
Diversification Opportunities for Astral Foods and MidCap Financial
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Astral and MidCap is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Astral Foods Limited and MidCap Financial Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MidCap Financial Inv 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 MidCap Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MidCap Financial Inv has no effect on the direction of Astral Foods i.e., Astral Foods and MidCap Financial go up and down completely randomly.
Pair Corralation between Astral Foods and MidCap Financial
Assuming the 90 days trading horizon Astral Foods Limited is expected to generate 5.18 times more return on investment than MidCap Financial. However, Astral Foods is 5.18 times more volatile than MidCap Financial Investment. It trades about 0.05 of its potential returns per unit of risk. MidCap Financial Investment is currently generating about 0.07 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. MidCap Financial Investment
Performance |
| Timeline |
| Astral Foods Limited |
| MidCap Financial Inv |
Astral Foods and MidCap Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astral Foods and MidCap Financial
The main advantage of trading using opposite Astral Foods and MidCap Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astral Foods position performs unexpectedly, MidCap Financial 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 MidCap Financial will offset losses from the drop in MidCap Financial's 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 |
| MidCap Financial vs. ANTA SPORTS PRODUCT | MidCap Financial vs. COLUMBIA SPORTSWEAR | MidCap Financial vs. ON SEMICONDUCTOR | MidCap Financial vs. PLAY2CHILL SA ZY |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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