Correlation Between Tesla and Astra Space
Can any of the company-specific risk be diversified away by investing in both Tesla and Astra Space 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 Tesla and Astra Space into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tesla Inc and Astra Space, you can compare the effects of market volatilities on Tesla and Astra Space 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 Tesla with a short position of Astra Space. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tesla and Astra Space.
Diversification Opportunities for Tesla and Astra Space
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Tesla and Astra is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Tesla Inc and Astra Space in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astra Space and Tesla 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 Tesla Inc are associated (or correlated) with Astra Space. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astra Space has no effect on the direction of Tesla i.e., Tesla and Astra Space go up and down completely randomly.
Pair Corralation between Tesla and Astra Space
If you would invest 37,928 in Tesla Inc on November 2, 2024 and sell it today you would earn a total of 2,100 from holding Tesla Inc or generate 5.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 5.26% |
| Values | Daily Returns |
Tesla Inc vs. Astra Space
Performance |
| Timeline |
| Tesla Inc |
| Astra Space |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Tesla and Astra Space Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tesla and Astra Space
The main advantage of trading using opposite Tesla and Astra Space positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tesla position performs unexpectedly, Astra Space 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 Space will offset losses from the drop in Astra Space's long position.The idea behind Tesla Inc and Astra Space pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Astra Space vs. Virgin Galactic Holdings | Astra Space vs. Planet Labs PBC | Astra Space vs. Eve Holding | Astra Space vs. Redwire Corp |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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