Correlation Between Astoria Investments and Famous Brands
Can any of the company-specific risk be diversified away by investing in both Astoria Investments and Famous Brands 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 Famous Brands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astoria Investments and Famous Brands, you can compare the effects of market volatilities on Astoria Investments and Famous Brands 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 Famous Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astoria Investments and Famous Brands.
Diversification Opportunities for Astoria Investments and Famous Brands
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Astoria and Famous is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Astoria Investments and Famous Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Famous Brands 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 Famous Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Famous Brands has no effect on the direction of Astoria Investments i.e., Astoria Investments and Famous Brands go up and down completely randomly.
Pair Corralation between Astoria Investments and Famous Brands
Assuming the 90 days trading horizon Astoria Investments is expected to generate 2.27 times more return on investment than Famous Brands. However, Astoria Investments is 2.27 times more volatile than Famous Brands. It trades about 0.02 of its potential returns per unit of risk. Famous Brands is currently generating about 0.02 per unit of risk. If you would invest 76,000 in Astoria Investments on September 13, 2024 and sell it today you would earn a total of 6,500 from holding Astoria Investments or generate 8.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Astoria Investments vs. Famous Brands
Performance |
| Timeline |
| Astoria Investments |
| Famous Brands |
Astoria Investments and Famous Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astoria Investments and Famous Brands
The main advantage of trading using opposite Astoria Investments and Famous Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astoria Investments position performs unexpectedly, Famous Brands 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 Famous Brands will offset losses from the drop in Famous Brands' 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 |
| Famous Brands vs. Master Drilling Group | Famous Brands vs. Trematon Capital Investments | Famous Brands vs. Reinet Investments SCA | Famous Brands 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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