Correlation Between ASTRA INTERNATIONAL and Lendlease
Can any of the company-specific risk be diversified away by investing in both ASTRA INTERNATIONAL and Lendlease 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 ASTRA INTERNATIONAL and Lendlease into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASTRA INTERNATIONAL and Lendlease Group, you can compare the effects of market volatilities on ASTRA INTERNATIONAL and Lendlease 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 ASTRA INTERNATIONAL with a short position of Lendlease. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASTRA INTERNATIONAL and Lendlease.
Diversification Opportunities for ASTRA INTERNATIONAL and Lendlease
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ASTRA and Lendlease is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding ASTRA INTERNATIONAL and Lendlease Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lendlease Group and ASTRA INTERNATIONAL 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 ASTRA INTERNATIONAL are associated (or correlated) with Lendlease. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lendlease Group has no effect on the direction of ASTRA INTERNATIONAL i.e., ASTRA INTERNATIONAL and Lendlease go up and down completely randomly.
Pair Corralation between ASTRA INTERNATIONAL and Lendlease
Assuming the 90 days trading horizon ASTRA INTERNATIONAL is expected to generate 0.95 times more return on investment than Lendlease. However, ASTRA INTERNATIONAL is 1.06 times less risky than Lendlease. It trades about -0.11 of its potential returns per unit of risk. Lendlease Group is currently generating about -0.18 per unit of risk. If you would invest 29.00 in ASTRA INTERNATIONAL on November 4, 2024 and sell it today you would lose (2.00) from holding ASTRA INTERNATIONAL or give up 6.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASTRA INTERNATIONAL vs. Lendlease Group
Performance |
| Timeline |
| ASTRA INTERNATIONAL |
| Lendlease Group |
ASTRA INTERNATIONAL and Lendlease Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASTRA INTERNATIONAL and Lendlease
The main advantage of trading using opposite ASTRA INTERNATIONAL and Lendlease positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASTRA INTERNATIONAL position performs unexpectedly, Lendlease 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 Lendlease will offset losses from the drop in Lendlease's long position.| ASTRA INTERNATIONAL vs. Apple Inc | ASTRA INTERNATIONAL vs. Apple Inc | ASTRA INTERNATIONAL vs. Apple Inc | ASTRA INTERNATIONAL vs. Apple Inc |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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