Correlation Between Astrotech Corp and Air Industries
Can any of the company-specific risk be diversified away by investing in both Astrotech Corp and Air Industries 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 Astrotech Corp and Air Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astrotech Corp and Air Industries Group, you can compare the effects of market volatilities on Astrotech Corp and Air Industries 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 Astrotech Corp with a short position of Air Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astrotech Corp and Air Industries.
Diversification Opportunities for Astrotech Corp and Air Industries
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Astrotech and Air is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Astrotech Corp and Air Industries Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Industries Group and Astrotech Corp 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 Astrotech Corp are associated (or correlated) with Air Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Industries Group has no effect on the direction of Astrotech Corp i.e., Astrotech Corp and Air Industries go up and down completely randomly.
Pair Corralation between Astrotech Corp and Air Industries
Given the investment horizon of 90 days Astrotech Corp is expected to generate 0.67 times more return on investment than Air Industries. However, Astrotech Corp is 1.49 times less risky than Air Industries. It trades about 0.02 of its potential returns per unit of risk. Air Industries Group is currently generating about -0.21 per unit of risk. If you would invest 761.00 in Astrotech Corp on August 28, 2024 and sell it today you would earn a total of 1.00 from holding Astrotech Corp or generate 0.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astrotech Corp vs. Air Industries Group
Performance |
| Timeline |
| Astrotech Corp |
| Air Industries Group |
Astrotech Corp and Air Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astrotech Corp and Air Industries
The main advantage of trading using opposite Astrotech Corp and Air Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astrotech Corp position performs unexpectedly, Air Industries 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 Air Industries will offset losses from the drop in Air Industries' long position.| Astrotech Corp vs. Vontier Corp | Astrotech Corp vs. ESCO Technologies | Astrotech Corp vs. MKS Instruments | Astrotech Corp vs. Sensata Technologies Holding |
| Air Industries vs. SIFCO Industries | Air Industries vs. CPI Aerostructures | Air Industries vs. VSE Corporation | Air Industries vs. National Presto Industries |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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