Correlation Between Astral Foods and SINGAPORE POST
Can any of the company-specific risk be diversified away by investing in both Astral Foods and SINGAPORE POST 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 SINGAPORE POST 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 SINGAPORE POST, you can compare the effects of market volatilities on Astral Foods and SINGAPORE POST 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 SINGAPORE POST. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astral Foods and SINGAPORE POST.
Diversification Opportunities for Astral Foods and SINGAPORE POST
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Astral and SINGAPORE is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Astral Foods Limited and SINGAPORE POST in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SINGAPORE POST 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 SINGAPORE POST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SINGAPORE POST has no effect on the direction of Astral Foods i.e., Astral Foods and SINGAPORE POST go up and down completely randomly.
Pair Corralation between Astral Foods and SINGAPORE POST
Assuming the 90 days trading horizon Astral Foods is expected to generate 4.2 times less return on investment than SINGAPORE POST. But when comparing it to its historical volatility, Astral Foods Limited is 1.87 times less risky than SINGAPORE POST. It trades about 0.09 of its potential returns per unit of risk. SINGAPORE POST is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 31.00 in SINGAPORE POST on September 3, 2024 and sell it today you would earn a total of 8.00 from holding SINGAPORE POST or generate 25.81% 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. SINGAPORE POST
Performance |
| Timeline |
| Astral Foods Limited |
| SINGAPORE POST |
Astral Foods and SINGAPORE POST Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astral Foods and SINGAPORE POST
The main advantage of trading using opposite Astral Foods and SINGAPORE POST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astral Foods position performs unexpectedly, SINGAPORE POST 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 SINGAPORE POST will offset losses from the drop in SINGAPORE POST's long position.| Astral Foods vs. Archer Daniels Midland | Astral Foods vs. Tyson Foods | Astral Foods vs. Wilmar International Limited | Astral Foods vs. SalMar ASA |
| SINGAPORE POST vs. Cal Maine Foods | SINGAPORE POST vs. Tyson Foods | SINGAPORE POST vs. Astral Foods Limited | SINGAPORE POST vs. Lery Seafood 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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