Correlation Between AstroNova and Aquagold International
Can any of the company-specific risk be diversified away by investing in both AstroNova and Aquagold International 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 AstroNova and Aquagold International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AstroNova and Aquagold International, you can compare the effects of market volatilities on AstroNova and Aquagold International 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 AstroNova with a short position of Aquagold International. Check out your portfolio center. Please also check ongoing floating volatility patterns of AstroNova and Aquagold International.
Diversification Opportunities for AstroNova and Aquagold International
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between AstroNova and Aquagold is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding AstroNova and Aquagold International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aquagold International and AstroNova 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 AstroNova are associated (or correlated) with Aquagold International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aquagold International has no effect on the direction of AstroNova i.e., AstroNova and Aquagold International go up and down completely randomly.
Pair Corralation between AstroNova and Aquagold International
Given the investment horizon of 90 days AstroNova is expected to generate 164.58 times less return on investment than Aquagold International. But when comparing it to its historical volatility, AstroNova is 21.93 times less risky than Aquagold International. It trades about 0.01 of its potential returns per unit of risk. Aquagold International is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 25.00 in Aquagold International on November 19, 2024 and sell it today you would lose (24.96) from holding Aquagold International or give up 99.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
AstroNova vs. Aquagold International
Performance |
| Timeline |
| AstroNova |
| Aquagold International |
AstroNova and Aquagold International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AstroNova and Aquagold International
The main advantage of trading using opposite AstroNova and Aquagold International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AstroNova position performs unexpectedly, Aquagold International 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 Aquagold International will offset losses from the drop in Aquagold International's long position.| AstroNova vs. Key Tronic | AstroNova vs. Identiv | AstroNova vs. Red Cat Holdings | AstroNova vs. TransAct Technologies Incorporated |
| Aquagold International vs. PepsiCo | Aquagold International vs. Coca Cola Consolidated | Aquagold International vs. Monster Beverage Corp | Aquagold International vs. Celsius Holdings |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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