Correlation Between ASTRA INTERNATIONAL and Pure Storage

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

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

Diversification Opportunities for ASTRA INTERNATIONAL and Pure Storage

0.59

Correlation Coefficient

ASTRA INTERNATIONAL  Pure Storage

Very weak diversification

The 3 months correlation between ASTRA and Pure is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding ASTRA INTERNATIONAL and Pure Storage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pure Storage and ASTRA INTERNATIONAL 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 INTERNATIONAL are associated (or correlated) with Pure Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pure Storage has no effect on the direction of ASTRA INTERNATIONAL i.e., ASTRA INTERNATIONAL and Pure Storage go up and down completely randomly.

Pair Corralation between ASTRA INTERNATIONAL and Pure Storage

Assuming the 90 days trading horizon ASTRA INTERNATIONAL is expected to generate 1.04 times more return on investment than Pure Storage. However, ASTRA INTERNATIONAL is 1.04 times more volatile than Pure Storage. It trades about 0.02 of its potential returns per unit of risk. Pure Storage is currently generating about -0.11 per unit of risk. If you would invest  29.00  in ASTRA INTERNATIONAL on December 29, 2024 and sell it today you would earn a total of  0.00  from holding ASTRA INTERNATIONAL or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.44%
Values	Daily Returns

ASTRA INTERNATIONAL  vs.  Pure Storage

ASTRA INTERNATIONAL

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ASTRA INTERNATIONAL are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, ASTRA INTERNATIONAL is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pure Storage

Risk-Adjusted Performance

Very Weak

Over the last 90 days Pure Storage has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with ASTRA INTERNATIONAL and Pure Storage

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

The idea behind ASTRA INTERNATIONAL and Pure Storage 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.