Correlation Between Astec Industries and Deere
Can any of the company-specific risk be diversified away by investing in both Astec Industries and Deere 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 Astec Industries and Deere into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astec Industries and Deere Company, you can compare the effects of market volatilities on Astec Industries and Deere 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 Astec Industries with a short position of Deere. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astec Industries and Deere.
Diversification Opportunities for Astec Industries and Deere
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Astec and Deere is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Astec Industries and Deere Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deere Company and Astec Industries 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 Astec Industries are associated (or correlated) with Deere. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deere Company has no effect on the direction of Astec Industries i.e., Astec Industries and Deere go up and down completely randomly.
Pair Corralation between Astec Industries and Deere
Given the investment horizon of 90 days Astec Industries is expected to generate 2.39 times more return on investment than Deere. However, Astec Industries is 2.39 times more volatile than Deere Company. It trades about 0.38 of its potential returns per unit of risk. Deere Company is currently generating about 0.41 per unit of risk. If you would invest 3,477 in Astec Industries on December 19, 2023 and sell it today you would earn a total of 587.00 from holding Astec Industries or generate 16.88% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 95.24% |
Values | Daily Returns |
Astec Industries vs. Deere Company
Performance |
Timeline |
Astec Industries |
Deere Company |
Astec Industries and Deere Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Astec Industries and Deere
The main advantage of trading using opposite Astec Industries and Deere positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astec Industries position performs unexpectedly, Deere 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 Deere will offset losses from the drop in Deere's long position.Astec Industries vs. Lion Electric Corp | Astec Industries vs. Hanesbrands | Astec Industries vs. Hyster Yale Materials Handling | Astec Industries vs. Palantir TechnologiesInc |
Deere vs. GreenPower Motor | Deere vs. Hyster Yale Materials Handling | Deere vs. Alamo Group | Deere vs. Caterpillar |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |