Correlation Between Astoria Investments and EnX
Can any of the company-specific risk be diversified away by investing in both Astoria Investments and EnX 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 EnX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astoria Investments and enX Group, you can compare the effects of market volatilities on Astoria Investments and EnX 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 EnX. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astoria Investments and EnX.
Diversification Opportunities for Astoria Investments and EnX
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Astoria and EnX is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Astoria Investments and enX Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on enX 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 EnX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of enX Group has no effect on the direction of Astoria Investments i.e., Astoria Investments and EnX go up and down completely randomly.
Pair Corralation between Astoria Investments and EnX
Assuming the 90 days trading horizon Astoria Investments is expected to generate 0.85 times more return on investment than EnX. However, Astoria Investments is 1.17 times less risky than EnX. It trades about 0.01 of its potential returns per unit of risk. enX Group is currently generating about -0.02 per unit of risk. If you would invest 91,000 in Astoria Investments on September 12, 2024 and sell it today you would lose (8,500) from holding Astoria Investments or give up 9.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Astoria Investments vs. enX Group
Performance |
| Timeline |
| Astoria Investments |
| enX Group |
Astoria Investments and EnX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astoria Investments and EnX
The main advantage of trading using opposite Astoria Investments and EnX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astoria Investments position performs unexpectedly, EnX 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 EnX will offset losses from the drop in EnX's long position.| Astoria Investments vs. Reinet Investments SCA | Astoria Investments vs. Zeder Investments | Astoria Investments vs. Sasol Ltd Bee | Astoria Investments vs. Centaur Bci Balanced |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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