Correlation Between Astra Energy and CEZ A

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

By analyzing existing cross correlation between Astra Energy and CEZ A S, you can compare the effects of market volatilities on Astra Energy and CEZ A 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 CEZ A. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra Energy and CEZ A.

Diversification Opportunities for Astra Energy and CEZ A

0.0

Correlation Coefficient

Astra Energy  CEZ A

Pay attention - limited upside

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

Pair Corralation between Astra Energy and CEZ A

If you would invest  6.75  in Astra Energy on December 2, 2024 and sell it today you would lose (0.15) from holding Astra Energy or give up 2.22% of portfolio value over 90 days.

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

Astra Energy  vs.  CEZ A S

Astra Energy

Risk-Adjusted Performance

Very Weak

Over the last 90 days Astra Energy has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather fragile basic indicators, Astra Energy may actually be approaching a critical reversion point that can send shares even higher in April 2025.

CEZ A S

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Astra Energy and CEZ A

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

The idea behind Astra Energy and CEZ A S 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.