Correlation Between Astral Foods and Yue Da
Can any of the company-specific risk be diversified away by investing in both Astral Foods and Yue Da 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 Yue Da 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 Yue Da International, you can compare the effects of market volatilities on Astral Foods and Yue Da 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 Yue Da. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astral Foods and Yue Da.
Diversification Opportunities for Astral Foods and Yue Da
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Astral and Yue is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Astral Foods Limited and Yue Da International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yue Da International 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 Yue Da. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yue Da International has no effect on the direction of Astral Foods i.e., Astral Foods and Yue Da go up and down completely randomly.
Pair Corralation between Astral Foods and Yue Da
Assuming the 90 days trading horizon Astral Foods is expected to generate 1.32 times less return on investment than Yue Da. But when comparing it to its historical volatility, Astral Foods Limited is 2.99 times less risky than Yue Da. It trades about 0.3 of its potential returns per unit of risk. Yue Da International is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1.35 in Yue Da International on September 12, 2024 and sell it today you would earn a total of 0.20 from holding Yue Da International or generate 14.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Astral Foods Limited vs. Yue Da International
Performance |
| Timeline |
| Astral Foods Limited |
| Yue Da International |
Astral Foods and Yue Da Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astral Foods and Yue Da
The main advantage of trading using opposite Astral Foods and Yue Da positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astral Foods position performs unexpectedly, Yue Da 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 Yue Da will offset losses from the drop in Yue Da's long position.| Astral Foods vs. Tyson Foods | Astral Foods vs. Mowi ASA | Astral Foods vs. SalMar ASA | Astral Foods vs. Superior Plus Corp |
| Yue Da vs. BANKINTER ADR 2007 | Yue Da vs. The Yokohama Rubber | Yue Da vs. MBANK | Yue Da vs. PT Bank Maybank |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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