Correlation Between Netflix and ASTRA INTERNATIONAL
Can any of the company-specific risk be diversified away by investing in both Netflix 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 Netflix and ASTRA INTERNATIONAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Netflix and ASTRA INTERNATIONAL, you can compare the effects of market volatilities on Netflix 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 Netflix with a short position of ASTRA INTERNATIONAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netflix and ASTRA INTERNATIONAL.
Diversification Opportunities for Netflix and ASTRA INTERNATIONAL
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Netflix and ASTRA is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Netflix and ASTRA INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASTRA INTERNATIONAL and Netflix 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 Netflix 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 Netflix i.e., Netflix and ASTRA INTERNATIONAL go up and down completely randomly.
Pair Corralation between Netflix and ASTRA INTERNATIONAL
Given the investment horizon of 90 days Netflix is expected to generate 1.29 times more return on investment than ASTRA INTERNATIONAL. However, Netflix is 1.29 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 31,783 in Netflix on September 4, 2024 and sell it today you would earn a total of 57,991 from holding Netflix or generate 182.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 98.21% |
| Values | Daily Returns |
Netflix vs. ASTRA INTERNATIONAL
Performance |
| Timeline |
| Netflix |
| ASTRA INTERNATIONAL |
Netflix and ASTRA INTERNATIONAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Netflix and ASTRA INTERNATIONAL
The main advantage of trading using opposite Netflix and ASTRA INTERNATIONAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Netflix 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.| Netflix vs. Paramount Global Class | Netflix vs. Roku Inc | Netflix vs. Warner Bros Discovery | Netflix vs. AMC Entertainment Holdings |
| ASTRA INTERNATIONAL vs. TOTAL GABON | ASTRA INTERNATIONAL vs. Walgreens Boots Alliance | ASTRA INTERNATIONAL vs. Peak Resources Limited |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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