Correlation Between Advanced Medical and ASTRA INTERNATIONAL

Can any of the company-specific risk be diversified away by investing in both Advanced 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 Advanced 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 Advanced Medical Solutions and ASTRA INTERNATIONAL, you can compare the effects of market volatilities on Advanced 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 Advanced Medical with a short position of ASTRA INTERNATIONAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Medical and ASTRA INTERNATIONAL.

Diversification Opportunities for Advanced Medical and ASTRA INTERNATIONAL

0.3

Correlation Coefficient

Advanced Medical  ASTRA INTERNATIONAL

Weak diversification

The 3 months correlation between Advanced and ASTRA is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Medical Solutions and ASTRA INTERNATIONAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASTRA INTERNATIONAL and Advanced 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 Advanced Medical Solutions 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 Advanced Medical i.e., Advanced Medical and ASTRA INTERNATIONAL go up and down completely randomly.

Pair Corralation between Advanced Medical and ASTRA INTERNATIONAL

Assuming the 90 days trading horizon Advanced Medical is expected to generate 1.47 times less return on investment than ASTRA INTERNATIONAL. But when comparing it to its historical volatility, Advanced Medical Solutions is 1.13 times less risky than ASTRA INTERNATIONAL. It trades about 0.08 of its potential returns per unit of risk. ASTRA INTERNATIONAL is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  22.00  in ASTRA INTERNATIONAL on April 24, 2025 and sell it today you would earn a total of  4.00  from holding ASTRA INTERNATIONAL or generate 18.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

Advanced Medical Solutions  vs.  ASTRA INTERNATIONAL

Advanced Medical Sol

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Advanced Medical Solutions are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Advanced Medical unveiled solid returns over the last few months and may actually be approaching a breakup point.

ASTRA INTERNATIONAL

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ASTRA INTERNATIONAL are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, ASTRA INTERNATIONAL unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Advanced Medical and ASTRA INTERNATIONAL

The main advantage of trading using opposite Advanced Medical and ASTRA INTERNATIONAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced 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 Advanced Medical Solutions 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.