Correlation Between Astoria Investments and Growthpoint Properties

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

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

Diversification Opportunities for Astoria Investments and Growthpoint Properties

0.08

Correlation Coefficient

Astoria Investments  Growthpoint Properties

Significant diversification

The 3 months correlation between Astoria and Growthpoint is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Astoria Investments and Growthpoint Properties in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growthpoint Properties and Astoria Investments 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 Astoria Investments are associated (or correlated) with Growthpoint Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growthpoint Properties has no effect on the direction of Astoria Investments i.e., Astoria Investments and Growthpoint Properties go up and down completely randomly.

Pair Corralation between Astoria Investments and Growthpoint Properties

Assuming the 90 days trading horizon Astoria Investments is expected to generate 2.52 times more return on investment than Growthpoint Properties. However, Astoria Investments is 2.52 times more volatile than Growthpoint Properties. It trades about 0.02 of its potential returns per unit of risk. Growthpoint Properties is currently generating about 0.04 per unit of risk. If you would invest  82,500  in Astoria Investments on December 2, 2024 and sell it today you would earn a total of  2,500  from holding Astoria Investments or generate 3.03% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Astoria Investments  vs.  Growthpoint Properties

Astoria Investments

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Astoria Investments are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Astoria Investments is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Growthpoint Properties

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Astoria Investments and Growthpoint Properties

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

The idea behind Astoria Investments and Growthpoint Properties 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..