Correlation Between Astra Agro and Limoneira

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

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

Diversification Opportunities for Astra Agro and Limoneira

0.0

Correlation Coefficient

Astra Agro  Limoneira

Pay attention - limited upside

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

Pair Corralation between Astra Agro and Limoneira

If you would invest (100.00) in Astra Agro Lestari on December 29, 2024 and sell it today you would earn a total of  100.00  from holding Astra Agro Lestari or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Astra Agro Lestari  vs.  Limoneira Co

Astra Agro Lestari

Risk-Adjusted Performance

Very Weak

Over the last 90 days Astra Agro Lestari has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Astra Agro is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Limoneira

Risk-Adjusted Performance

Very Weak

Over the last 90 days Limoneira Co has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unsteady performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Astra Agro and Limoneira

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

The idea behind Astra Agro Lestari and Limoneira 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.