Correlation Between ASTRA INTERNATIONAL and Apple
Can any of the company-specific risk be diversified away by investing in both ASTRA INTERNATIONAL and Apple 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 Apple into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ASTRA INTERNATIONAL and Apple Inc, you can compare the effects of market volatilities on ASTRA INTERNATIONAL and Apple 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 Apple. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASTRA INTERNATIONAL and Apple.
Diversification Opportunities for ASTRA INTERNATIONAL and Apple
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between ASTRA and Apple is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding ASTRA INTERNATIONAL and Apple Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Apple Inc 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 Apple. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Apple Inc has no effect on the direction of ASTRA INTERNATIONAL i.e., ASTRA INTERNATIONAL and Apple go up and down completely randomly.
Pair Corralation between ASTRA INTERNATIONAL and Apple
Assuming the 90 days trading horizon ASTRA INTERNATIONAL is expected to generate 1.86 times less return on investment than Apple. In addition to that, ASTRA INTERNATIONAL is 3.5 times more volatile than Apple Inc. It trades about 0.01 of its total potential returns per unit of risk. Apple Inc is currently generating about 0.09 per unit of volatility. If you would invest 16,004 in Apple Inc on September 12, 2024 and sell it today you would earn a total of 7,436 from holding Apple Inc or generate 46.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ASTRA INTERNATIONAL vs. Apple Inc
Performance |
| Timeline |
| ASTRA INTERNATIONAL |
| Apple Inc |
ASTRA INTERNATIONAL and Apple Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ASTRA INTERNATIONAL and Apple
The main advantage of trading using opposite ASTRA INTERNATIONAL and Apple positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASTRA INTERNATIONAL position performs unexpectedly, Apple 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 Apple will offset losses from the drop in Apple'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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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