Correlation Between PACIFIC ONLINE and ASTRA INTERNATIONAL

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

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

Diversification Opportunities for PACIFIC ONLINE and ASTRA INTERNATIONAL

0.0

Correlation Coefficient

PACIFIC ONLINE  ASTRA INTERNATIONAL

Pay attention - limited upside

The 3 months correlation between PACIFIC and ASTRA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding PACIFIC ONLINE and ASTRA INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASTRA INTERNATIONAL and PACIFIC ONLINE 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 PACIFIC ONLINE are associated (or correlated) with ASTRA INTERNATIONAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASTRA INTERNATIONAL has no effect on the direction of PACIFIC ONLINE i.e., PACIFIC ONLINE and ASTRA INTERNATIONAL go up and down completely randomly.

Pair Corralation between PACIFIC ONLINE and ASTRA INTERNATIONAL

If you would invest  31.00  in ASTRA INTERNATIONAL on September 12, 2024 and sell it today you would earn a total of  2.00  from holding ASTRA INTERNATIONAL or generate 6.45% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

PACIFIC ONLINE  vs.  ASTRA INTERNATIONAL

PACIFIC ONLINE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PACIFIC ONLINE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, PACIFIC ONLINE is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

ASTRA INTERNATIONAL

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ASTRA INTERNATIONAL are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, ASTRA INTERNATIONAL may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with PACIFIC ONLINE and ASTRA INTERNATIONAL

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

The idea behind PACIFIC ONLINE and ASTRA INTERNATIONAL 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.