Correlation Between Astral Foods and Natural Health
Can any of the company-specific risk be diversified away by investing in both Astral Foods and Natural Health 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 Natural Health 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 Natural Health Trends, you can compare the effects of market volatilities on Astral Foods and Natural Health 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 Natural Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astral Foods and Natural Health.
Diversification Opportunities for Astral Foods and Natural Health
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Astral and Natural is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Astral Foods Limited and Natural Health Trends in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natural Health Trends 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 Natural Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natural Health Trends has no effect on the direction of Astral Foods i.e., Astral Foods and Natural Health go up and down completely randomly.
Pair Corralation between Astral Foods and Natural Health
Assuming the 90 days trading horizon Astral Foods Limited is expected to generate 0.89 times more return on investment than Natural Health. However, Astral Foods Limited is 1.12 times less risky than Natural Health. It trades about 0.12 of its potential returns per unit of risk. Natural Health Trends is currently generating about -0.03 per unit of risk. If you would invest 705.00 in Astral Foods Limited on September 2, 2024 and sell it today you would earn a total of 245.00 from holding Astral Foods Limited or generate 34.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astral Foods Limited vs. Natural Health Trends
Performance |
| Timeline |
| Astral Foods Limited |
| Natural Health Trends |
Astral Foods and Natural Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astral Foods and Natural Health
The main advantage of trading using opposite Astral Foods and Natural Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astral Foods position performs unexpectedly, Natural Health 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 Natural Health will offset losses from the drop in Natural Health's long position.| Astral Foods vs. Vastned Retail NV | Astral Foods vs. TFS FINANCIAL | Astral Foods vs. Heartland Financial USA | Astral Foods vs. Mizuho Financial Group |
| Natural Health vs. NURAN WIRELESS INC | Natural Health vs. YOOMA WELLNESS INC | Natural Health vs. Haverty Furniture Companies | Natural Health vs. LGI Homes |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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