Correlation Between OverActive Media and Astralis

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

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

Diversification Opportunities for OverActive Media and Astralis

0.0

Correlation Coefficient

OverActive Media  Astralis

Pay attention - limited upside

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

Pair Corralation between OverActive Media and Astralis

If you would invest  14.00  in OverActive Media Corp on September 2, 2024 and sell it today you would earn a total of  5.00  from holding OverActive Media Corp or generate 35.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.54%
Values	Daily Returns

OverActive Media Corp  vs.  Astralis AS

OverActive Media Corp

Risk-Adjusted Performance

7 of 100

OK

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

Astralis AS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Astralis AS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Astralis is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with OverActive Media and Astralis

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

The idea behind OverActive Media Corp and Astralis AS 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.