Correlation Between Astronics and Ballistic Recovery
Can any of the company-specific risk be diversified away by investing in both Astronics and Ballistic Recovery 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 Astronics and Ballistic Recovery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astronics and Ballistic Recovery Systems, you can compare the effects of market volatilities on Astronics and Ballistic Recovery 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 Astronics with a short position of Ballistic Recovery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astronics and Ballistic Recovery.
Diversification Opportunities for Astronics and Ballistic Recovery
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Astronics and Ballistic is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Astronics and Ballistic Recovery Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ballistic Recovery and Astronics 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 Astronics are associated (or correlated) with Ballistic Recovery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ballistic Recovery has no effect on the direction of Astronics i.e., Astronics and Ballistic Recovery go up and down completely randomly.
Pair Corralation between Astronics and Ballistic Recovery
Given the investment horizon of 90 days Astronics is expected to generate 0.45 times more return on investment than Ballistic Recovery. However, Astronics is 2.22 times less risky than Ballistic Recovery. It trades about -0.06 of its potential returns per unit of risk. Ballistic Recovery Systems is currently generating about -0.12 per unit of risk. If you would invest 1,923 in Astronics on September 15, 2024 and sell it today you would lose (302.00) from holding Astronics or give up 15.7% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Astronics vs. Ballistic Recovery Systems
Performance |
Timeline |
Astronics |
Ballistic Recovery |
Astronics and Ballistic Recovery Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Astronics and Ballistic Recovery
The main advantage of trading using opposite Astronics and Ballistic Recovery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astronics position performs unexpectedly, Ballistic Recovery 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 Ballistic Recovery will offset losses from the drop in Ballistic Recovery's long position.Astronics vs. Novocure | Astronics vs. HubSpot | Astronics vs. DigitalOcean Holdings | Astronics vs. Appian Corp |
Ballistic Recovery vs. HUMANA INC | Ballistic Recovery vs. Barloworld Ltd ADR | Ballistic Recovery vs. Morningstar Unconstrained Allocation | Ballistic Recovery vs. Thrivent High Yield |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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