Correlation Between Astar and Efecte Oyj

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

By analyzing existing cross correlation between Astar and Efecte Oyj, you can compare the effects of market volatilities on Astar and Efecte Oyj 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 Efecte Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astar and Efecte Oyj.

Diversification Opportunities for Astar and Efecte Oyj

0.0

Correlation Coefficient

Astar  Efecte Oyj

Pay attention - limited upside

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

Pair Corralation between Astar and Efecte Oyj

If you would invest (100.00) in Efecte Oyj on October 10, 2024 and sell it today you would earn a total of  100.00  from holding Efecte Oyj or generate -100.0% return on investment over 90 days.

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

Astar  vs.  Efecte Oyj

Astar

Risk-Adjusted Performance

2 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Astar are ranked lower than 2 (%) 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.

Efecte Oyj

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Astar and Efecte Oyj

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

The idea behind Astar and Efecte Oyj 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.