Correlation Between AST SpaceMobile and Bear Creek

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

By analyzing existing cross correlation between AST SpaceMobile and Bear Creek Mining, you can compare the effects of market volatilities on AST SpaceMobile and Bear Creek 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 AST SpaceMobile with a short position of Bear Creek. Check out your portfolio center. Please also check ongoing floating volatility patterns of AST SpaceMobile and Bear Creek.

Diversification Opportunities for AST SpaceMobile and Bear Creek

-0.78

Correlation Coefficient

AST SpaceMobile  Bear Creek

Pay attention - limited upside

The 3 months correlation between AST and Bear is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding AST SpaceMobile and Bear Creek Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bear Creek Mining and AST SpaceMobile 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 AST SpaceMobile are associated (or correlated) with Bear Creek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bear Creek Mining has no effect on the direction of AST SpaceMobile i.e., AST SpaceMobile and Bear Creek go up and down completely randomly.

Pair Corralation between AST SpaceMobile and Bear Creek

Assuming the 90 days horizon AST SpaceMobile is expected to generate 1.56 times more return on investment than Bear Creek. However, AST SpaceMobile is 1.56 times more volatile than Bear Creek Mining. It trades about 0.02 of its potential returns per unit of risk. Bear Creek Mining is currently generating about 0.01 per unit of risk. If you would invest  280.00  in AST SpaceMobile on February 21, 2024 and sell it today you would lose (141.20) from holding AST SpaceMobile or give up 50.43% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	99.8%
Values	Daily Returns

AST SpaceMobile  vs.  Bear Creek Mining

AST SpaceMobile

Risk-Adjusted Performance

8 of 100

Modest

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

Bear Creek Mining

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Bear Creek Mining are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward-looking signals, Bear Creek reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with AST SpaceMobile and Bear Creek

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

The idea behind AST SpaceMobile and Bear Creek Mining 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.