Correlation Between Astarta Holding and Agroton Public

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

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

Diversification Opportunities for Astarta Holding and Agroton Public

0.68

Correlation Coefficient

Astarta Holding  Agroton Public

Poor diversification

The 3 months correlation between Astarta and Agroton is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Astarta Holding NV and Agroton Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agroton Public and Astarta Holding 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 Astarta Holding NV are associated (or correlated) with Agroton Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agroton Public has no effect on the direction of Astarta Holding i.e., Astarta Holding and Agroton Public go up and down completely randomly.

Pair Corralation between Astarta Holding and Agroton Public

Assuming the 90 days trading horizon Astarta Holding NV is expected to generate 0.78 times more return on investment than Agroton Public. However, Astarta Holding NV is 1.29 times less risky than Agroton Public. It trades about 0.24 of its potential returns per unit of risk. Agroton Public is currently generating about 0.09 per unit of risk. If you would invest  2,880  in Astarta Holding NV on September 5, 2024 and sell it today you would earn a total of  990.00  from holding Astarta Holding NV or generate 34.38% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.41%
Values	Daily Returns

Astarta Holding NV  vs.  Agroton Public

Astarta Holding NV

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Astarta Holding NV are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Astarta Holding reported solid returns over the last few months and may actually be approaching a breakup point.

Agroton Public

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Agroton Public are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Agroton Public reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Astarta Holding and Agroton Public

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

The idea behind Astarta Holding NV and Agroton Public 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 Anywhere module to track or share privately all of your investments from the convenience of any device.