Correlation Between Astar and LBTCOR

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

By analyzing existing cross correlation between Astar and LBTCOR 10875 15 JAN 31, you can compare the effects of market volatilities on Astar and LBTCOR 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 LBTCOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astar and LBTCOR.

Diversification Opportunities for Astar and LBTCOR

0.34

Correlation Coefficient

Astar  LBTCOR

Weak diversification

The 3 months correlation between Astar and LBTCOR is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Astar and LBTCOR 10875 15 JAN 31 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LBTCOR 10875 15 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 LBTCOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LBTCOR 10875 15 has no effect on the direction of Astar i.e., Astar and LBTCOR go up and down completely randomly.

Pair Corralation between Astar and LBTCOR

Assuming the 90 days trading horizon Astar is expected to generate 1.65 times more return on investment than LBTCOR. However, Astar is 1.65 times more volatile than LBTCOR 10875 15 JAN 31. It trades about 0.02 of its potential returns per unit of risk. LBTCOR 10875 15 JAN 31 is currently generating about -0.28 per unit of risk. If you would invest  6.24  in Astar on October 12, 2024 and sell it today you would lose (0.23) from holding Astar or give up 3.69% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	23.81%
Values	Daily Returns

Astar  vs.  LBTCOR 10875 15 JAN 31

Astar

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Astar are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, Astar is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

LBTCOR 10875 15

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days LBTCOR 10875 15 JAN 31 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for LBTCOR 10875 15 JAN 31 investors.

Pair Trading with Astar and LBTCOR

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

The idea behind Astar and LBTCOR 10875 15 JAN 31 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.