Correlation Between FAST RETAIL and ASTRA INTERNATIONAL
Can any of the company-specific risk be diversified away by investing in both FAST RETAIL 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 FAST RETAIL and ASTRA INTERNATIONAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FAST RETAIL ADR and ASTRA INTERNATIONAL, you can compare the effects of market volatilities on FAST RETAIL 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 FAST RETAIL with a short position of ASTRA INTERNATIONAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of FAST RETAIL and ASTRA INTERNATIONAL.
Diversification Opportunities for FAST RETAIL and ASTRA INTERNATIONAL
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between FAST and ASTRA is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding FAST RETAIL ADR and ASTRA INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASTRA INTERNATIONAL and FAST RETAIL 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 FAST RETAIL ADR 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 FAST RETAIL i.e., FAST RETAIL and ASTRA INTERNATIONAL go up and down completely randomly.
Pair Corralation between FAST RETAIL and ASTRA INTERNATIONAL
Assuming the 90 days trading horizon FAST RETAIL ADR is expected to under-perform the ASTRA INTERNATIONAL. In addition to that, FAST RETAIL is 1.69 times more volatile than ASTRA INTERNATIONAL. It trades about -0.24 of its total potential returns per unit of risk. ASTRA INTERNATIONAL is currently generating about 0.01 per unit of volatility. 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 |
FAST RETAIL ADR vs. ASTRA INTERNATIONAL
Performance |
| Timeline |
| FAST RETAIL ADR |
| ASTRA INTERNATIONAL |
FAST RETAIL and ASTRA INTERNATIONAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FAST RETAIL and ASTRA INTERNATIONAL
The main advantage of trading using opposite FAST RETAIL and ASTRA INTERNATIONAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FAST RETAIL 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.| FAST RETAIL vs. BANKINTER ADR 2007 | FAST RETAIL vs. AUSNUTRIA DAIRY | FAST RETAIL vs. SUN LIFE FINANCIAL | FAST RETAIL vs. Chiba Bank |
| 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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