Correlation Between Astar and PLBIIJ

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

By analyzing existing cross correlation between Astar and PLBIIJ 425 05 MAY 25, you can compare the effects of market volatilities on Astar and PLBIIJ 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 PLBIIJ. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astar and PLBIIJ.

Diversification Opportunities for Astar and PLBIIJ

-0.8

Correlation Coefficient

Astar  PLBIIJ

Pay attention - limited upside

The 3 months correlation between Astar and PLBIIJ is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Astar and PLBIIJ 425 05 MAY 25 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PLBIIJ 425 05 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 PLBIIJ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PLBIIJ 425 05 has no effect on the direction of Astar i.e., Astar and PLBIIJ go up and down completely randomly.

Pair Corralation between Astar and PLBIIJ

Assuming the 90 days trading horizon Astar is expected to under-perform the PLBIIJ. In addition to that, Astar is 50.86 times more volatile than PLBIIJ 425 05 MAY 25. It trades about -0.19 of its total potential returns per unit of risk. PLBIIJ 425 05 MAY 25 is currently generating about -0.06 per unit of volatility. If you would invest  9,970  in PLBIIJ 425 05 MAY 25 on December 24, 2024 and sell it today you would lose (7.00) from holding PLBIIJ 425 05 MAY 25 or give up 0.07% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	20.31%
Values	Daily Returns

Astar  vs.  PLBIIJ 425 05 MAY 25

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.

PLBIIJ 425 05

Risk-Adjusted Performance

Very Weak

Over the last 90 days PLBIIJ 425 05 MAY 25 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, PLBIIJ 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 PLBIIJ

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

The idea behind Astar and PLBIIJ 425 05 MAY 25 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.