Correlation Between Astar and Sena Development

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

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

Diversification Opportunities for Astar and Sena Development

0.79

Correlation Coefficient

Astar  Sena Development

Poor diversification

The 3 months correlation between Astar and Sena is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Astar and Sena Development Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sena Development Public 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 Sena Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sena Development Public has no effect on the direction of Astar i.e., Astar and Sena Development go up and down completely randomly.

Pair Corralation between Astar and Sena Development

Assuming the 90 days trading horizon Astar is expected to under-perform the Sena Development. In addition to that, Astar is 5.24 times more volatile than Sena Development Public. It trades about -0.18 of its total potential returns per unit of risk. Sena Development Public is currently generating about -0.06 per unit of volatility. If you would invest  224.00  in Sena Development Public on December 21, 2024 and sell it today you would lose (8.00) from holding Sena Development Public or give up 3.57% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	96.83%
Values	Daily Returns

Astar  vs.  Sena Development Public

Astar

Risk-Adjusted Performance

Very Weak

Over the last 90 days Astar has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Crypto's fundamental indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for Astar shareholders.

Sena Development Public

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sena Development Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Sena Development is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Astar and Sena Development

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

The idea behind Astar and Sena Development Public 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.