Correlation Between ASTRA INTERNATIONAL and Sun Art
Can any of the company-specific risk be diversified away by investing in both ASTRA INTERNATIONAL and Sun Art 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 Sun Art into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASTRA INTERNATIONAL and Sun Art Retail, you can compare the effects of market volatilities on ASTRA INTERNATIONAL and Sun Art 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 Sun Art. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASTRA INTERNATIONAL and Sun Art.
Diversification Opportunities for ASTRA INTERNATIONAL and Sun Art
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ASTRA and Sun is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding ASTRA INTERNATIONAL and Sun Art Retail in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Art Retail 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 Sun Art. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Art Retail has no effect on the direction of ASTRA INTERNATIONAL i.e., ASTRA INTERNATIONAL and Sun Art go up and down completely randomly.
Pair Corralation between ASTRA INTERNATIONAL and Sun Art
Assuming the 90 days trading horizon ASTRA INTERNATIONAL is expected to generate 3.67 times less return on investment than Sun Art. But when comparing it to its historical volatility, ASTRA INTERNATIONAL is 2.24 times less risky than Sun Art. It trades about 0.07 of its potential returns per unit of risk. Sun Art Retail is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 16.00 in Sun Art Retail on August 31, 2024 and sell it today you would earn a total of 14.00 from holding Sun Art Retail or generate 87.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASTRA INTERNATIONAL vs. Sun Art Retail
Performance |
| Timeline |
| ASTRA INTERNATIONAL |
| Sun Art Retail |
ASTRA INTERNATIONAL and Sun Art Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASTRA INTERNATIONAL and Sun Art
The main advantage of trading using opposite ASTRA INTERNATIONAL and Sun Art positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASTRA INTERNATIONAL position performs unexpectedly, Sun Art 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 Sun Art will offset losses from the drop in Sun Art's long position.| ASTRA INTERNATIONAL vs. United Utilities Group | ASTRA INTERNATIONAL vs. Calibre Mining Corp | ASTRA INTERNATIONAL vs. QBE Insurance Group | ASTRA INTERNATIONAL vs. REVO INSURANCE SPA |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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