Correlation Between Origin Agritech and PT Astra
Can any of the company-specific risk be diversified away by investing in both Origin Agritech and PT Astra 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 Origin Agritech and PT Astra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Origin Agritech and PT Astra International, you can compare the effects of market volatilities on Origin Agritech and PT Astra 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 Origin Agritech with a short position of PT Astra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Origin Agritech and PT Astra.
Diversification Opportunities for Origin Agritech and PT Astra
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Origin and ASJA is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Origin Agritech and PT Astra International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Astra International and Origin Agritech 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 Origin Agritech are associated (or correlated) with PT Astra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Astra International has no effect on the direction of Origin Agritech i.e., Origin Agritech and PT Astra go up and down completely randomly.
Pair Corralation between Origin Agritech and PT Astra
Assuming the 90 days trading horizon Origin Agritech is expected to under-perform the PT Astra. But the stock apears to be less risky and, when comparing its historical volatility, Origin Agritech is 1.07 times less risky than PT Astra. The stock trades about -0.04 of its potential returns per unit of risk. The PT Astra International is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 29.00 in PT Astra International on August 28, 2024 and sell it today you would earn a total of 0.00 from holding PT Astra International or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Origin Agritech vs. PT Astra International
Performance |
| Timeline |
| Origin Agritech |
| PT Astra International |
Origin Agritech and PT Astra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Origin Agritech and PT Astra
The main advantage of trading using opposite Origin Agritech and PT Astra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Origin Agritech position performs unexpectedly, PT Astra 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 PT Astra will offset losses from the drop in PT Astra's long position.| Origin Agritech vs. 24SEVENOFFICE GROUP AB | Origin Agritech vs. MAVEN WIRELESS SWEDEN | Origin Agritech vs. SIDETRADE EO 1 | Origin Agritech vs. HK Electric Investments |
| PT Astra vs. Lion One Metals | PT Astra vs. UNITED RENTALS | PT Astra vs. PLAY2CHILL SA ZY | PT Astra vs. VIAPLAY GROUP AB |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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