Correlation Between Astral Foods and PF Bakkafrost
Can any of the company-specific risk be diversified away by investing in both Astral Foods and PF Bakkafrost 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 PF Bakkafrost 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 PF Bakkafrost, you can compare the effects of market volatilities on Astral Foods and PF Bakkafrost 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 PF Bakkafrost. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astral Foods and PF Bakkafrost.
Diversification Opportunities for Astral Foods and PF Bakkafrost
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Astral and 6BF is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Astral Foods Limited and PF Bakkafrost in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PF Bakkafrost 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 PF Bakkafrost. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PF Bakkafrost has no effect on the direction of Astral Foods i.e., Astral Foods and PF Bakkafrost go up and down completely randomly.
Pair Corralation between Astral Foods and PF Bakkafrost
Assuming the 90 days trading horizon Astral Foods Limited is expected to generate 1.39 times more return on investment than PF Bakkafrost. However, Astral Foods is 1.39 times more volatile than PF Bakkafrost. It trades about 0.2 of its potential returns per unit of risk. PF Bakkafrost is currently generating about 0.06 per unit of risk. If you would invest 860.00 in Astral Foods Limited on September 5, 2024 and sell it today you would earn a total of 75.00 from holding Astral Foods Limited or generate 8.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astral Foods Limited vs. PF Bakkafrost
Performance |
| Timeline |
| Astral Foods Limited |
| PF Bakkafrost |
Astral Foods and PF Bakkafrost Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astral Foods and PF Bakkafrost
The main advantage of trading using opposite Astral Foods and PF Bakkafrost positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astral Foods position performs unexpectedly, PF Bakkafrost 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 PF Bakkafrost will offset losses from the drop in PF Bakkafrost's long position.| Astral Foods vs. Citic Telecom International | Astral Foods vs. Fevertree Drinks PLC | Astral Foods vs. THAI BEVERAGE | Astral Foods vs. Entravision Communications |
| PF Bakkafrost vs. HYDROFARM HLD GRP | PF Bakkafrost vs. Astral Foods Limited | PF Bakkafrost vs. Australian Agricultural | PF Bakkafrost vs. Performance Food Group |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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