Correlation Between Astar and ShuYu Civilian

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

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

Diversification Opportunities for Astar and ShuYu Civilian

0.3

Correlation Coefficient

Astar  ShuYu Civilian

Weak diversification

The 3 months correlation between Astar and ShuYu is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Astar and ShuYu Civilian Pharmacy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ShuYu Civilian Pharmacy and Astar 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 Astar are associated (or correlated) with ShuYu Civilian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ShuYu Civilian Pharmacy has no effect on the direction of Astar i.e., Astar and ShuYu Civilian go up and down completely randomly.

Pair Corralation between Astar and ShuYu Civilian

Assuming the 90 days trading horizon Astar is expected to generate 1.15 times more return on investment than ShuYu Civilian. However, Astar is 1.15 times more volatile than ShuYu Civilian Pharmacy. It trades about -0.02 of its potential returns per unit of risk. ShuYu Civilian Pharmacy is currently generating about -0.03 per unit of risk. If you would invest  9.25  in Astar on October 9, 2024 and sell it today you would lose (3.11) from holding Astar or give up 33.62% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	69.62%
Values	Daily Returns

Astar  vs.  ShuYu Civilian Pharmacy

Astar

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Astar are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Astar exhibited solid returns over the last few months and may actually be approaching a breakup point.

ShuYu Civilian Pharmacy

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ShuYu Civilian Pharmacy are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, ShuYu Civilian is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Astar and ShuYu Civilian

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

The idea behind Astar and ShuYu Civilian Pharmacy 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.