Correlation Between Diamyd Medical and ASTRA INTERNATIONAL

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Can any of the company-specific risk be diversified away by investing in both Diamyd Medical and ASTRA INTERNATIONAL 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 Diamyd Medical and ASTRA INTERNATIONAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Diamyd Medical AB and ASTRA INTERNATIONAL, you can compare the effects of market volatilities on Diamyd Medical and ASTRA INTERNATIONAL 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 Diamyd Medical with a short position of ASTRA INTERNATIONAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Diamyd Medical and ASTRA INTERNATIONAL.

Diversification Opportunities for Diamyd Medical and ASTRA INTERNATIONAL

DiamydASTRADiversified AwayDiamydASTRADiversified Away100%
-0.31
  Correlation Coefficient

Very good diversification

The 3 months correlation between Diamyd and ASTRA is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Diamyd Medical AB and ASTRA INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASTRA INTERNATIONAL and Diamyd Medical 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 Diamyd Medical AB are associated (or correlated) with ASTRA INTERNATIONAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASTRA INTERNATIONAL has no effect on the direction of Diamyd Medical i.e., Diamyd Medical and ASTRA INTERNATIONAL go up and down completely randomly.

Pair Corralation between Diamyd Medical and ASTRA INTERNATIONAL

Assuming the 90 days horizon Diamyd Medical AB is expected to generate 2.1 times more return on investment than ASTRA INTERNATIONAL. However, Diamyd Medical is 2.1 times more volatile than ASTRA INTERNATIONAL. It trades about 0.16 of its potential returns per unit of risk. ASTRA INTERNATIONAL is currently generating about -0.02 per unit of risk. If you would invest  109.00  in Diamyd Medical AB on October 26, 2024 and sell it today you would earn a total of  45.00  from holding Diamyd Medical AB or generate 41.28% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy98.33%
ValuesDaily Returns

Diamyd Medical AB  vs.  ASTRA INTERNATIONAL

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -10010203040
JavaScript chart by amCharts 3.21.15DMN ASJA
       Timeline  
Diamyd Medical AB 

Risk-Adjusted Performance

12 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Diamyd Medical AB are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Diamyd Medical reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan11.11.21.31.41.51.6
ASTRA INTERNATIONAL 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days ASTRA INTERNATIONAL has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, ASTRA INTERNATIONAL is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan0.270.2750.280.2850.290.2950.3

Diamyd Medical and ASTRA INTERNATIONAL Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-12.86-9.63-6.4-3.170.03.286.7410.213.6517.11 0.020.040.060.08
JavaScript chart by amCharts 3.21.15DMN ASJA
       Returns  

Pair Trading with Diamyd Medical and ASTRA INTERNATIONAL

The main advantage of trading using opposite Diamyd Medical and ASTRA INTERNATIONAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Diamyd Medical position performs unexpectedly, ASTRA INTERNATIONAL 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 ASTRA INTERNATIONAL will offset losses from the drop in ASTRA INTERNATIONAL's long position.
The idea behind Diamyd Medical AB and ASTRA INTERNATIONAL 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.

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