Correlation Between ASTORY CoLtd and MEDIPOST

Can any of the company-specific risk be diversified away by investing in both ASTORY CoLtd and MEDIPOST 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 ASTORY CoLtd and MEDIPOST into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ASTORY CoLtd and MEDIPOST Co, you can compare the effects of market volatilities on ASTORY CoLtd and MEDIPOST 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 ASTORY CoLtd with a short position of MEDIPOST. Check out your portfolio center. Please also check ongoing floating volatility patterns of ASTORY CoLtd and MEDIPOST.

Diversification Opportunities for ASTORY CoLtd and MEDIPOST

0.76

Correlation Coefficient

ASTORY CoLtd  MEDIPOST

Poor diversification

The 3 months correlation between ASTORY and MEDIPOST is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding ASTORY CoLtd and MEDIPOST Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MEDIPOST and ASTORY CoLtd 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 ASTORY CoLtd are associated (or correlated) with MEDIPOST. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MEDIPOST has no effect on the direction of ASTORY CoLtd i.e., ASTORY CoLtd and MEDIPOST go up and down completely randomly.

Pair Corralation between ASTORY CoLtd and MEDIPOST

Assuming the 90 days trading horizon ASTORY CoLtd is expected to generate 3.96 times less return on investment than MEDIPOST. But when comparing it to its historical volatility, ASTORY CoLtd is 2.03 times less risky than MEDIPOST. It trades about 0.11 of its potential returns per unit of risk. MEDIPOST Co is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest  594,000  in MEDIPOST Co on September 22, 2024 and sell it today you would earn a total of  641,000  from holding MEDIPOST Co or generate 107.91% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

ASTORY CoLtd  vs.  MEDIPOST Co

ASTORY CoLtd

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ASTORY CoLtd are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, ASTORY CoLtd sustained solid returns over the last few months and may actually be approaching a breakup point.

MEDIPOST

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in MEDIPOST Co are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, MEDIPOST sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ASTORY CoLtd and MEDIPOST

The main advantage of trading using opposite ASTORY CoLtd and MEDIPOST positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ASTORY CoLtd position performs unexpectedly, MEDIPOST 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 MEDIPOST will offset losses from the drop in MEDIPOST's long position.

The idea behind ASTORY CoLtd and MEDIPOST Co 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.

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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.