Correlation Between ASGN and Castellum
Can any of the company-specific risk be diversified away by investing in both ASGN and Castellum 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 ASGN and Castellum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASGN Inc and Castellum, you can compare the effects of market volatilities on ASGN and Castellum 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 ASGN with a short position of Castellum. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASGN and Castellum.
Diversification Opportunities for ASGN and Castellum
Average diversification
The 3 months correlation between ASGN and Castellum is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding ASGN Inc and Castellum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Castellum and ASGN 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 ASGN Inc are associated (or correlated) with Castellum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Castellum has no effect on the direction of ASGN i.e., ASGN and Castellum go up and down completely randomly.
Pair Corralation between ASGN and Castellum
Given the investment horizon of 90 days ASGN Inc is expected to under-perform the Castellum. But the stock apears to be less risky and, when comparing its historical volatility, ASGN Inc is 2.43 times less risky than Castellum. The stock trades about -0.03 of its potential returns per unit of risk. The Castellum is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 16.00 in Castellum on August 27, 2024 and sell it today you would earn a total of 0.00 from holding Castellum or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASGN Inc vs. Castellum
Performance |
| Timeline |
| ASGN Inc |
| Castellum |
ASGN and Castellum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASGN and Castellum
The main advantage of trading using opposite ASGN and Castellum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASGN position performs unexpectedly, Castellum 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 Castellum will offset losses from the drop in Castellum's long position.The idea behind ASGN Inc and Castellum pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Castellum vs. Flint Telecom Group | Castellum vs. Datametrex AI Limited | Castellum vs. TTEC Holdings | Castellum vs. Digatrade Financial Corp |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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