Correlation Between AstroNova and Super Micro
Can any of the company-specific risk be diversified away by investing in both AstroNova and Super Micro 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 Super Micro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AstroNova and Super Micro Computer, you can compare the effects of market volatilities on AstroNova and Super Micro 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 Super Micro. Check out your portfolio center. Please also check ongoing floating volatility patterns of AstroNova and Super Micro.
Diversification Opportunities for AstroNova and Super Micro
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between AstroNova and Super is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding AstroNova and Super Micro Computer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Super Micro Computer 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 Super Micro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Super Micro Computer has no effect on the direction of AstroNova i.e., AstroNova and Super Micro go up and down completely randomly.
Pair Corralation between AstroNova and Super Micro
Given the investment horizon of 90 days AstroNova is expected to generate 0.21 times more return on investment than Super Micro. However, AstroNova is 4.82 times less risky than Super Micro. It trades about 0.13 of its potential returns per unit of risk. Super Micro Computer is currently generating about -0.04 per unit of risk. If you would invest 1,393 in AstroNova on August 30, 2024 and sell it today you would earn a total of 109.00 from holding AstroNova or generate 7.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
AstroNova vs. Super Micro Computer
Performance |
| Timeline |
| AstroNova |
| Super Micro Computer |
AstroNova and Super Micro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AstroNova and Super Micro
The main advantage of trading using opposite AstroNova and Super Micro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AstroNova position performs unexpectedly, Super Micro 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 Super Micro will offset losses from the drop in Super Micro's long position.| AstroNova vs. Key Tronic | AstroNova vs. Identiv | AstroNova vs. Red Cat Holdings | AstroNova vs. TransAct Technologies Incorporated |
| Super Micro vs. D Wave Quantum | Super Micro vs. Rigetti Computing | Super Micro vs. Cricut Inc | Super Micro vs. Quantum Computing |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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