Correlation Between CEA Industries and Astec Industries
Can any of the company-specific risk be diversified away by investing in both CEA Industries and Astec 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 CEA Industries and Astec Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CEA Industries and Astec Industries, you can compare the effects of market volatilities on CEA Industries and Astec 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 CEA Industries with a short position of Astec Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of CEA Industries and Astec Industries.
Diversification Opportunities for CEA Industries and Astec Industries
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CEA and Astec is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding CEA Industries and Astec Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astec Industries and CEA Industries 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 CEA Industries are associated (or correlated) with Astec Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astec Industries has no effect on the direction of CEA Industries i.e., CEA Industries and Astec Industries go up and down completely randomly.
Pair Corralation between CEA Industries and Astec Industries
Given the investment horizon of 90 days CEA Industries is expected to under-perform the Astec Industries. In addition to that, CEA Industries is 1.02 times more volatile than Astec Industries. It trades about -0.09 of its total potential returns per unit of risk. Astec Industries is currently generating about 0.13 per unit of volatility. If you would invest 3,173 in Astec Industries on August 31, 2024 and sell it today you would earn a total of 661.00 from holding Astec Industries or generate 20.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CEA Industries vs. Astec Industries
Performance |
| Timeline |
| CEA Industries |
| Astec Industries |
CEA Industries and Astec Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CEA Industries and Astec Industries
The main advantage of trading using opposite CEA Industries and Astec Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CEA Industries position performs unexpectedly, Astec 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 Astec Industries will offset losses from the drop in Astec Industries' long position.| CEA Industries vs. Rev Group | CEA Industries vs. Caterpillar | CEA Industries vs. Buhler Industries | CEA Industries vs. Austin Engineering Limited |
| Astec Industries vs. AGCO Corporation | Astec Industries vs. Deere Company | Astec Industries vs. Lindsay | Astec Industries vs. Alamo Group |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |