Correlation Between Astoria Investments and Absa
Can any of the company-specific risk be diversified away by investing in both Astoria Investments and Absa 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 Astoria Investments and Absa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astoria Investments and Absa Group, you can compare the effects of market volatilities on Astoria Investments and Absa 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 Astoria Investments with a short position of Absa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astoria Investments and Absa.
Diversification Opportunities for Astoria Investments and Absa
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Astoria and Absa is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Astoria Investments and Absa Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Absa Group and Astoria Investments 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 Astoria Investments are associated (or correlated) with Absa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Absa Group has no effect on the direction of Astoria Investments i.e., Astoria Investments and Absa go up and down completely randomly.
Pair Corralation between Astoria Investments and Absa
Assuming the 90 days trading horizon Astoria Investments is expected to generate 1.22 times less return on investment than Absa. In addition to that, Astoria Investments is 2.25 times more volatile than Absa Group. It trades about 0.05 of its total potential returns per unit of risk. Absa Group is currently generating about 0.15 per unit of volatility. If you would invest 1,684,100 in Absa Group on August 30, 2024 and sell it today you would earn a total of 45,900 from holding Absa Group or generate 2.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Astoria Investments vs. Absa Group
Performance |
| Timeline |
| Astoria Investments |
| Absa Group |
Astoria Investments and Absa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astoria Investments and Absa
The main advantage of trading using opposite Astoria Investments and Absa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astoria Investments position performs unexpectedly, Absa 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 Absa will offset losses from the drop in Absa's long position.| Astoria Investments vs. Remgro | Astoria Investments vs. Reinet Investments SCA | Astoria Investments vs. Zeder Investments |
| Absa vs. Reinet Investments SCA | Absa vs. Copper 360 | Absa vs. Kap Industrial Holdings | Absa vs. Astoria Investments |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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