Correlation Between Astar and Cornerstone Moderately

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

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

Diversification Opportunities for Astar and Cornerstone Moderately

-0.38

Correlation Coefficient

Astar  Cornerstone Moderately

Very good diversification

The 3 months correlation between Astar and Cornerstone is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Astar and Cornerstone Moderately Aggress in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cornerstone Moderately 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 Cornerstone Moderately. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cornerstone Moderately has no effect on the direction of Astar i.e., Astar and Cornerstone Moderately go up and down completely randomly.

Pair Corralation between Astar and Cornerstone Moderately

Assuming the 90 days trading horizon Astar is expected to under-perform the Cornerstone Moderately. In addition to that, Astar is 9.12 times more volatile than Cornerstone Moderately Aggressive. It trades about -0.19 of its total potential returns per unit of risk. Cornerstone Moderately Aggressive is currently generating about 0.04 per unit of volatility. If you would invest  2,613  in Cornerstone Moderately Aggressive on December 23, 2024 and sell it today you would earn a total of  29.00  from holding Cornerstone Moderately Aggressive or generate 1.11% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	93.85%
Values	Daily Returns

Astar  vs.  Cornerstone Moderately Aggress

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.

Cornerstone Moderately

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Cornerstone Moderately Aggressive are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Cornerstone Moderately 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 Cornerstone Moderately

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

The idea behind Astar and Cornerstone Moderately Aggressive 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.