Correlation Between Astra International and Ocwen Financial
Can any of the company-specific risk be diversified away by investing in both Astra International and Ocwen Financial 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 Ocwen Financial 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 Ocwen Financial, you can compare the effects of market volatilities on Astra International and Ocwen Financial 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 Ocwen Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra International and Ocwen Financial.
Diversification Opportunities for Astra International and Ocwen Financial
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Astra and Ocwen is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Astra International Tbk and Ocwen Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ocwen Financial 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 Ocwen Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ocwen Financial has no effect on the direction of Astra International i.e., Astra International and Ocwen Financial go up and down completely randomly.
Pair Corralation between Astra International and Ocwen Financial
If you would invest 639.00 in Astra International Tbk on September 12, 2024 and sell it today you would earn a total of 6.00 from holding Astra International Tbk or generate 0.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 1.59% |
| Values | Daily Returns |
Astra International Tbk vs. Ocwen Financial
Performance |
| Timeline |
| Astra International Tbk |
| Ocwen Financial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Astra International and Ocwen Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astra International and Ocwen Financial
The main advantage of trading using opposite Astra International and Ocwen Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra International position performs unexpectedly, Ocwen Financial 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 Ocwen Financial will offset losses from the drop in Ocwen Financial's long position.| Astra International vs. Allison Transmission Holdings | Astra International vs. Luminar Technologies | Astra International vs. Lear Corporation | Astra International vs. BorgWarner |
| Ocwen Financial vs. CNFinance Holdings | Ocwen Financial vs. Security National Financial | Ocwen Financial vs. Encore Capital Group | Ocwen Financial vs. Guild Holdings Co |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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