Correlation Between Heico and Astra Space

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

By analyzing existing cross correlation between Heico and Astra Space, you can compare the effects of market volatilities on Heico and Astra Space 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 Heico with a short position of Astra Space. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heico and Astra Space.

Diversification Opportunities for Heico and Astra Space

0.0

Correlation Coefficient

Heico  Astra Space

Pay attention - limited upside

The 3 months correlation between Heico and Astra is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Heico and Astra Space in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astra Space and Heico 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 Heico are associated (or correlated) with Astra Space. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astra Space has no effect on the direction of Heico i.e., Heico and Astra Space go up and down completely randomly.

Pair Corralation between Heico and Astra Space

If you would invest  23,959  in Heico on December 28, 2024 and sell it today you would earn a total of  2,904  from holding Heico or generate 12.12% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Heico  vs.  Astra Space

Heico

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Heico are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak technical and fundamental indicators, Heico demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Astra Space

Risk-Adjusted Performance

Very Weak

Over the last 90 days Astra Space has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Astra Space is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Heico and Astra Space

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

The idea behind Heico and Astra Space 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.

Check out your portfolio center.

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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.