Correlation Between Astra Space and Boeing

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Can any of the company-specific risk be diversified away by investing in both Astra Space and Boeing 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 Astra Space and Boeing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astra Space and Boeing Company, you can compare the effects of market volatilities on Astra Space and Boeing 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 Astra Space with a short position of Boeing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra Space and Boeing.

Diversification Opportunities for Astra Space and Boeing

0.54
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Astra and Boeing is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Astra Space Inc and Boeing Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boeing Company and Astra Space 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 Astra Space are associated (or correlated) with Boeing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boeing Company has no effect on the direction of Astra Space i.e., Astra Space and Boeing go up and down completely randomly.

Pair Corralation between Astra Space and Boeing

Given the investment horizon of 90 days Astra Space is expected to under-perform the Boeing. In addition to that, Astra Space is 1.74 times more volatile than Boeing Company. It trades about -0.17 of its total potential returns per unit of risk. Boeing Company is currently generating about -0.16 per unit of volatility. If you would invest  15,239  in Boeing Company on July 7, 2022 and sell it today you would lose (1,888)  from holding Boeing Company or give up 12.39% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Astra Space Inc  vs.  Boeing Company

 Performance (%) 
       Timeline  
Astra Space 
Astra Performance
0 of 100
Over the last 90 days Astra Space has generated negative risk-adjusted returns adding no value to investors with long positions. Even with conflicting performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in November 2022. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Astra Price Channel

Boeing Company 
Boeing Performance
0 of 100
Over the last 90 days Boeing Company has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Boeing is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Boeing Price Channel

Astra Space and Boeing Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Astra Space and Boeing

The main advantage of trading using opposite Astra Space and Boeing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra Space position performs unexpectedly, Boeing 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 Boeing will offset losses from the drop in Boeing's long position.
Astra Space vs. Amazon Inc
The idea behind Astra Space and Boeing Company 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.
Boeing vs. Amazon Inc
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 Global Correlations module to find global opportunities by holding instruments from different markets.

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