Correlation Between Astra International and Burberry Group
Can any of the company-specific risk be diversified away by investing in both Astra International and Burberry Group 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 Astra International and Burberry Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astra International Tbk and Burberry Group plc, you can compare the effects of market volatilities on Astra International and Burberry Group 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 Astra International with a short position of Burberry Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra International and Burberry Group.
Diversification Opportunities for Astra International and Burberry Group
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Astra and Burberry is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Astra International Tbk and Burberry Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Burberry Group plc and Astra International 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 Astra International Tbk are associated (or correlated) with Burberry Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Burberry Group plc has no effect on the direction of Astra International i.e., Astra International and Burberry Group go up and down completely randomly.
Pair Corralation between Astra International and Burberry Group
Assuming the 90 days horizon Astra International Tbk is expected to generate 0.4 times more return on investment than Burberry Group. However, Astra International Tbk is 2.5 times less risky than Burberry Group. It trades about 0.06 of its potential returns per unit of risk. Burberry Group plc is currently generating about -0.02 per unit of risk. If you would invest 550.00 in Astra International Tbk on August 24, 2024 and sell it today you would earn a total of 65.00 from holding Astra International Tbk or generate 11.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astra International Tbk vs. Burberry Group plc
Performance |
| Timeline |
| Astra International Tbk |
| Burberry Group plc |
Astra International and Burberry Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astra International and Burberry Group
The main advantage of trading using opposite Astra International and Burberry Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra International position performs unexpectedly, Burberry Group 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 Burberry Group will offset losses from the drop in Burberry Group's long position.| Astra International vs. Allison Transmission Holdings | Astra International vs. Luminar Technologies | Astra International vs. Quantumscape Corp | Astra International vs. Lear Corporation |
| Burberry Group vs. Kering SA | Burberry Group vs. Compagnie Financiere Richemont | Burberry Group vs. Swatch Group AG | Burberry Group vs. Prada Spa PK |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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