Correlation Between Ace Hardware and PT Anugerah
Can any of the company-specific risk be diversified away by investing in both Ace Hardware and PT Anugerah 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 Ace Hardware and PT Anugerah into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ace Hardware Indonesia and PT Anugerah Spareparts, you can compare the effects of market volatilities on Ace Hardware and PT Anugerah 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 Ace Hardware with a short position of PT Anugerah. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ace Hardware and PT Anugerah.
Diversification Opportunities for Ace Hardware and PT Anugerah
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ace and AEGS is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Ace Hardware Indonesia and PT Anugerah Spareparts in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Anugerah Spareparts and Ace Hardware 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 Ace Hardware Indonesia are associated (or correlated) with PT Anugerah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Anugerah Spareparts has no effect on the direction of Ace Hardware i.e., Ace Hardware and PT Anugerah go up and down completely randomly.
Pair Corralation between Ace Hardware and PT Anugerah
Assuming the 90 days trading horizon Ace Hardware Indonesia is expected to generate 0.49 times more return on investment than PT Anugerah. However, Ace Hardware Indonesia is 2.03 times less risky than PT Anugerah. It trades about 0.04 of its potential returns per unit of risk. PT Anugerah Spareparts is currently generating about -0.04 per unit of risk. If you would invest 62,322 in Ace Hardware Indonesia on September 2, 2024 and sell it today you would earn a total of 14,678 from holding Ace Hardware Indonesia or generate 23.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 82.68% |
| Values | Daily Returns |
Ace Hardware Indonesia vs. PT Anugerah Spareparts
Performance |
| Timeline |
| Ace Hardware Indonesia |
| PT Anugerah Spareparts |
Ace Hardware and PT Anugerah Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ace Hardware and PT Anugerah
The main advantage of trading using opposite Ace Hardware and PT Anugerah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ace Hardware position performs unexpectedly, PT Anugerah 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 Anugerah will offset losses from the drop in PT Anugerah's long position.| Ace Hardware vs. Japfa Comfeed Indonesia | Ace Hardware vs. Charoen Pokphand Indonesia | Ace Hardware vs. Erajaya Swasembada Tbk | Ace Hardware vs. Indofood Cbp Sukses |
| PT Anugerah vs. Bank Central Asia | PT Anugerah vs. Bank Rakyat Indonesia | PT Anugerah vs. Bayan Resources Tbk | PT Anugerah vs. Bank Mandiri Persero |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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