Correlation Between AUST AGRICULTURAL and ASTRA INTERNATIONAL
Can any of the company-specific risk be diversified away by investing in both AUST AGRICULTURAL and ASTRA INTERNATIONAL 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 AUST AGRICULTURAL and ASTRA INTERNATIONAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AUST AGRICULTURAL and ASTRA INTERNATIONAL, you can compare the effects of market volatilities on AUST AGRICULTURAL and ASTRA INTERNATIONAL 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 AUST AGRICULTURAL with a short position of ASTRA INTERNATIONAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of AUST AGRICULTURAL and ASTRA INTERNATIONAL.
Diversification Opportunities for AUST AGRICULTURAL and ASTRA INTERNATIONAL
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between AUST and ASTRA is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding AUST AGRICULTURAL and ASTRA INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASTRA INTERNATIONAL and AUST AGRICULTURAL 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 AUST AGRICULTURAL are associated (or correlated) with ASTRA INTERNATIONAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASTRA INTERNATIONAL has no effect on the direction of AUST AGRICULTURAL i.e., AUST AGRICULTURAL and ASTRA INTERNATIONAL go up and down completely randomly.
Pair Corralation between AUST AGRICULTURAL and ASTRA INTERNATIONAL
Assuming the 90 days trading horizon AUST AGRICULTURAL is expected to generate 1.97 times less return on investment than ASTRA INTERNATIONAL. But when comparing it to its historical volatility, AUST AGRICULTURAL is 1.42 times less risky than ASTRA INTERNATIONAL. It trades about 0.0 of its potential returns per unit of risk. ASTRA INTERNATIONAL is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 28.00 in ASTRA INTERNATIONAL on October 25, 2024 and sell it today you would earn a total of 0.00 from holding ASTRA INTERNATIONAL or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
AUST AGRICULTURAL vs. ASTRA INTERNATIONAL
Performance |
| Timeline |
| AUST AGRICULTURAL |
| ASTRA INTERNATIONAL |
AUST AGRICULTURAL and ASTRA INTERNATIONAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AUST AGRICULTURAL and ASTRA INTERNATIONAL
The main advantage of trading using opposite AUST AGRICULTURAL and ASTRA INTERNATIONAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AUST AGRICULTURAL position performs unexpectedly, ASTRA INTERNATIONAL 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 ASTRA INTERNATIONAL will offset losses from the drop in ASTRA INTERNATIONAL's long position.| AUST AGRICULTURAL vs. WisdomTree Investments | AUST AGRICULTURAL vs. FAST RETAIL ADR | AUST AGRICULTURAL vs. COSTCO WHOLESALE CDR | AUST AGRICULTURAL vs. PICKN PAY STORES |
| ASTRA INTERNATIONAL vs. SCOTT TECHNOLOGY | ASTRA INTERNATIONAL vs. Wayside Technology Group | ASTRA INTERNATIONAL vs. Micron Technology | ASTRA INTERNATIONAL vs. PLAYMATES TOYS |
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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