Correlation Between Cricut and AstroNova
Can any of the company-specific risk be diversified away by investing in both Cricut and AstroNova 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 Cricut and AstroNova into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cricut Inc and AstroNova, you can compare the effects of market volatilities on Cricut and AstroNova 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 Cricut with a short position of AstroNova. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cricut and AstroNova.
Diversification Opportunities for Cricut and AstroNova
Excellent diversification
The 3 months correlation between Cricut and AstroNova is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Cricut Inc and AstroNova in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AstroNova and Cricut 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 Cricut Inc are associated (or correlated) with AstroNova. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AstroNova has no effect on the direction of Cricut i.e., Cricut and AstroNova go up and down completely randomly.
Pair Corralation between Cricut and AstroNova
Given the investment horizon of 90 days Cricut Inc is expected to under-perform the AstroNova. In addition to that, Cricut is 1.5 times more volatile than AstroNova. It trades about -0.26 of its total potential returns per unit of risk. AstroNova is currently generating about 0.25 per unit of volatility. If you would invest 1,326 in AstroNova on August 31, 2024 and sell it today you would earn a total of 211.00 from holding AstroNova or generate 15.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cricut Inc vs. AstroNova
Performance |
| Timeline |
| Cricut Inc |
| AstroNova |
Cricut and AstroNova Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cricut and AstroNova
The main advantage of trading using opposite Cricut and AstroNova positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cricut position performs unexpectedly, AstroNova 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 AstroNova will offset losses from the drop in AstroNova's long position.| Cricut vs. Nano Dimension | Cricut vs. 3D Systems | Cricut vs. Markforged Holding Corp | Cricut vs. Stratasys |
| AstroNova vs. RLJ Lodging Trust | AstroNova vs. Aquagold International | AstroNova vs. Stepstone Group | AstroNova vs. Morningstar Unconstrained Allocation |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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