Correlation Between Astral Foods and Blue Label
Can any of the company-specific risk be diversified away by investing in both Astral Foods and Blue Label 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 Astral Foods and Blue Label into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astral Foods and Blue Label Telecoms, you can compare the effects of market volatilities on Astral Foods and Blue Label 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 Astral Foods with a short position of Blue Label. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astral Foods and Blue Label.
Diversification Opportunities for Astral Foods and Blue Label
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Astral and Blue is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Astral Foods and Blue Label Telecoms in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Label Telecoms and Astral Foods 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 Astral Foods are associated (or correlated) with Blue Label. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Label Telecoms has no effect on the direction of Astral Foods i.e., Astral Foods and Blue Label go up and down completely randomly.
Pair Corralation between Astral Foods and Blue Label
Assuming the 90 days trading horizon Astral Foods is expected to generate 54.03 times more return on investment than Blue Label. However, Astral Foods is 54.03 times more volatile than Blue Label Telecoms. It trades about 0.1 of its potential returns per unit of risk. Blue Label Telecoms is currently generating about 0.13 per unit of risk. If you would invest 1,560,000 in Astral Foods on November 2, 2024 and sell it today you would earn a total of 216,300 from holding Astral Foods or generate 13.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 98.8% |
| Values | Daily Returns |
Astral Foods vs. Blue Label Telecoms
Performance |
| Timeline |
| Astral Foods |
| Blue Label Telecoms |
Astral Foods and Blue Label Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astral Foods and Blue Label
The main advantage of trading using opposite Astral Foods and Blue Label positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astral Foods position performs unexpectedly, Blue Label 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 Blue Label will offset losses from the drop in Blue Label's long position.| Astral Foods vs. Prosus NV | Astral Foods vs. Compagnie Financire Richemont | Astral Foods vs. British American Tobacco | Astral Foods vs. Glencore PLC |
| Blue Label vs. MC Mining | Blue Label vs. Bytes Technology | Blue Label vs. Astral Foods | Blue Label vs. Mantengu Mining |
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 Stocks Directory module to find actively traded stocks across global markets.
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