Correlation Between FIRST SHIP and ASTRA INTERNATIONAL
Can any of the company-specific risk be diversified away by investing in both FIRST SHIP 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 FIRST SHIP and ASTRA INTERNATIONAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FIRST SHIP LEASE and ASTRA INTERNATIONAL, you can compare the effects of market volatilities on FIRST SHIP 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 FIRST SHIP with a short position of ASTRA INTERNATIONAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIRST SHIP and ASTRA INTERNATIONAL.
Diversification Opportunities for FIRST SHIP and ASTRA INTERNATIONAL
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between FIRST and ASTRA is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding FIRST SHIP LEASE and ASTRA INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASTRA INTERNATIONAL and FIRST SHIP 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 FIRST SHIP LEASE 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 FIRST SHIP i.e., FIRST SHIP and ASTRA INTERNATIONAL go up and down completely randomly.
Pair Corralation between FIRST SHIP and ASTRA INTERNATIONAL
Assuming the 90 days horizon FIRST SHIP LEASE is expected to generate 1.72 times more return on investment than ASTRA INTERNATIONAL. However, FIRST SHIP is 1.72 times more volatile than ASTRA INTERNATIONAL. It trades about 0.11 of its potential returns per unit of risk. ASTRA INTERNATIONAL is currently generating about 0.01 per unit of risk. If you would invest 2.26 in FIRST SHIP LEASE on October 24, 2024 and sell it today you would earn a total of 0.08 from holding FIRST SHIP LEASE or generate 3.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 94.44% |
| Values | Daily Returns |
FIRST SHIP LEASE vs. ASTRA INTERNATIONAL
Performance |
| Timeline |
| FIRST SHIP LEASE |
| ASTRA INTERNATIONAL |
FIRST SHIP and ASTRA INTERNATIONAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FIRST SHIP and ASTRA INTERNATIONAL
The main advantage of trading using opposite FIRST SHIP and ASTRA INTERNATIONAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIRST SHIP 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.| FIRST SHIP vs. PACIFIC ONLINE | FIRST SHIP vs. YATRA ONLINE DL 0001 | FIRST SHIP vs. NEWELL RUBBERMAID | FIRST SHIP vs. Summit Materials |
| ASTRA INTERNATIONAL vs. Lendlease Group | ASTRA INTERNATIONAL vs. GRENKELEASING Dusseldorf | ASTRA INTERNATIONAL vs. GBS Software AG | ASTRA INTERNATIONAL vs. FIRST SHIP LEASE |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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