Correlation Between Exxon and Astron Connect
Can any of the company-specific risk be diversified away by investing in both Exxon and Astron Connect 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 Exxon and Astron Connect into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EXXON MOBIL CDR and Astron Connect, you can compare the effects of market volatilities on Exxon and Astron Connect 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 Exxon with a short position of Astron Connect. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exxon and Astron Connect.
Diversification Opportunities for Exxon and Astron Connect
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Exxon and Astron is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding EXXON MOBIL CDR and Astron Connect in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astron Connect and Exxon 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 EXXON MOBIL CDR are associated (or correlated) with Astron Connect. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astron Connect has no effect on the direction of Exxon i.e., Exxon and Astron Connect go up and down completely randomly.
Pair Corralation between Exxon and Astron Connect
Assuming the 90 days trading horizon Exxon is expected to generate 10.99 times less return on investment than Astron Connect. But when comparing it to its historical volatility, EXXON MOBIL CDR is 9.55 times less risky than Astron Connect. It trades about 0.06 of its potential returns per unit of risk. Astron Connect is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 2.00 in Astron Connect on October 18, 2024 and sell it today you would earn a total of 1.00 from holding Astron Connect or generate 50.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
EXXON MOBIL CDR vs. Astron Connect
Performance |
| Timeline |
| EXXON MOBIL CDR |
| Astron Connect |
Exxon and Astron Connect Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Exxon and Astron Connect
The main advantage of trading using opposite Exxon and Astron Connect positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Exxon position performs unexpectedly, Astron Connect 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 Astron Connect will offset losses from the drop in Astron Connect's long position.| Exxon vs. Mako Mining Corp | Exxon vs. Firan Technology Group | Exxon vs. Ramp Metals | Exxon vs. Constellation Software |
| Astron Connect vs. Costco Wholesale Corp | Astron Connect vs. Verizon Communications CDR | Astron Connect vs. Bank of Nova | Astron Connect vs. Maple Leaf Foods |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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