Correlation Between Astra Energy and Azelio AB

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

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

Diversification Opportunities for Astra Energy and Azelio AB

0.0

Correlation Coefficient

Astra Energy  Azelio AB

Pay attention - limited upside

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

Pair Corralation between Astra Energy and Azelio AB

If you would invest  7.78  in Astra Energy on December 28, 2024 and sell it today you would earn a total of  0.59  from holding Astra Energy or generate 7.58% return on investment over 90 days.

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

Astra Energy  vs.  Azelio AB

Astra Energy

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Astra Energy are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, Astra Energy exhibited solid returns over the last few months and may actually be approaching a breakup point.

Azelio AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days Azelio AB has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Azelio AB is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Astra Energy and Azelio AB

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

The idea behind Astra Energy and Azelio AB 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.

Check out your portfolio center.

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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.