Correlation Between Touchstone Funds and Astor Star

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

By analyzing existing cross correlation between Touchstone Funds Group and Astor Star Fund, you can compare the effects of market volatilities on Touchstone Funds and Astor Star 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 Touchstone Funds with a short position of Astor Star. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Funds and Astor Star.

Diversification Opportunities for Touchstone Funds and Astor Star

0.86

Correlation Coefficient

Touchstone Funds  Astor Star

Very poor diversification

The 3 months correlation between Touchstone and Astor is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Funds Group and Astor Star Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astor Star Fund and Touchstone Funds 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 Touchstone Funds Group are associated (or correlated) with Astor Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astor Star Fund has no effect on the direction of Touchstone Funds i.e., Touchstone Funds and Astor Star go up and down completely randomly.

Pair Corralation between Touchstone Funds and Astor Star

Assuming the 90 days horizon Touchstone Funds is expected to generate 1.86 times less return on investment than Astor Star. But when comparing it to its historical volatility, Touchstone Funds Group is 1.36 times less risky than Astor Star. It trades about 0.13 of its potential returns per unit of risk. Astor Star Fund is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  1,542  in Astor Star Fund on May 20, 2025 and sell it today you would earn a total of  72.00  from holding Astor Star Fund or generate 4.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Touchstone Funds Group  vs.  Astor Star Fund

Touchstone Funds

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Touchstone Funds Group are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Touchstone Funds is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Astor Star Fund

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Astor Star Fund are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Astor Star is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Touchstone Funds and Astor Star

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

The idea behind Touchstone Funds Group and Astor Star Fund 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.