Correlation Between Astral Foods and STRAX AB
Can any of the company-specific risk be diversified away by investing in both Astral Foods and STRAX AB 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 STRAX AB 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 STRAX AB SK, you can compare the effects of market volatilities on Astral Foods and STRAX AB 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 STRAX AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astral Foods and STRAX AB.
Diversification Opportunities for Astral Foods and STRAX AB
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Astral and STRAX is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Astral Foods Limited and STRAX AB SK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STRAX AB SK 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 STRAX AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STRAX AB SK has no effect on the direction of Astral Foods i.e., Astral Foods and STRAX AB go up and down completely randomly.
Pair Corralation between Astral Foods and STRAX AB
Assuming the 90 days trading horizon Astral Foods Limited is expected to generate 4.99 times more return on investment than STRAX AB. However, Astral Foods is 4.99 times more volatile than STRAX AB SK. It trades about 0.23 of its potential returns per unit of risk. STRAX AB SK is currently generating about -0.23 per unit of risk. If you would invest 399.00 in Astral Foods Limited on October 24, 2024 and sell it today you would earn a total of 486.00 from holding Astral Foods Limited or generate 121.8% 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. STRAX AB SK
Performance |
| Timeline |
| Astral Foods Limited |
| STRAX AB SK |
Astral Foods and STRAX AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astral Foods and STRAX AB
The main advantage of trading using opposite Astral Foods and STRAX AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astral Foods position performs unexpectedly, STRAX AB 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 STRAX AB will offset losses from the drop in STRAX AB's long position.| Astral Foods vs. Vishay Intertechnology | Astral Foods vs. Kingdee International Software | Astral Foods vs. MCEWEN MINING INC | Astral Foods vs. SMA Solar Technology |
| STRAX AB vs. TYSON FOODS A | STRAX AB vs. Mitsui Chemicals | STRAX AB vs. US FOODS HOLDING | STRAX AB vs. KINGBOARD CHEMICAL |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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