Correlation Between Microvast Holdings and Astra International
Can any of the company-specific risk be diversified away by investing in both Microvast Holdings 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 Microvast Holdings and Astra International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Microvast Holdings and Astra International Tbk, you can compare the effects of market volatilities on Microvast Holdings 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 Microvast Holdings with a short position of Astra International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Microvast Holdings and Astra International.
Diversification Opportunities for Microvast Holdings and Astra International
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Microvast and Astra is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Microvast Holdings and Astra International Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astra International Tbk and Microvast Holdings 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 Microvast Holdings 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 Tbk has no effect on the direction of Microvast Holdings i.e., Microvast Holdings and Astra International go up and down completely randomly.
Pair Corralation between Microvast Holdings and Astra International
Given the investment horizon of 90 days Microvast Holdings is expected to generate 10.31 times more return on investment than Astra International. However, Microvast Holdings is 10.31 times more volatile than Astra International Tbk. It trades about 0.04 of its potential returns per unit of risk. Astra International Tbk is currently generating about 0.01 per unit of risk. If you would invest 137.00 in Microvast Holdings on November 9, 2024 and sell it today you would earn a total of 31.00 from holding Microvast Holdings or generate 22.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Microvast Holdings vs. Astra International Tbk
Performance |
| Timeline |
| Microvast Holdings |
| Astra International Tbk |
Microvast Holdings and Astra International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Microvast Holdings and Astra International
The main advantage of trading using opposite Microvast Holdings and Astra International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Microvast Holdings 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.| Microvast Holdings vs. FREYR Battery SA | Microvast Holdings vs. Bloom Energy Corp | Microvast Holdings vs. Enovix Corp | Microvast Holdings vs. Plug Power |
| Astra International vs. Allison Transmission Holdings | Astra International vs. Luminar Technologies | Astra International vs. Lear Corporation | Astra International vs. BorgWarner |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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