Correlation Between Akasha Wira and Wilmar Cahaya
Can any of the company-specific risk be diversified away by investing in both Akasha Wira and Wilmar Cahaya 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 Akasha Wira and Wilmar Cahaya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Akasha Wira International and Wilmar Cahaya Indonesia, you can compare the effects of market volatilities on Akasha Wira and Wilmar Cahaya 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 Akasha Wira with a short position of Wilmar Cahaya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akasha Wira and Wilmar Cahaya.
Diversification Opportunities for Akasha Wira and Wilmar Cahaya
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Akasha and Wilmar is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Akasha Wira International and Wilmar Cahaya Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilmar Cahaya Indonesia and Akasha Wira 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 Akasha Wira International are associated (or correlated) with Wilmar Cahaya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilmar Cahaya Indonesia has no effect on the direction of Akasha Wira i.e., Akasha Wira and Wilmar Cahaya go up and down completely randomly.
Pair Corralation between Akasha Wira and Wilmar Cahaya
Assuming the 90 days trading horizon Akasha Wira International is expected to generate 1.95 times more return on investment than Wilmar Cahaya. However, Akasha Wira is 1.95 times more volatile than Wilmar Cahaya Indonesia. It trades about 0.04 of its potential returns per unit of risk. Wilmar Cahaya Indonesia is currently generating about 0.02 per unit of risk. If you would invest 737,500 in Akasha Wira International on November 27, 2024 and sell it today you would earn a total of 215,000 from holding Akasha Wira International or generate 29.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Akasha Wira International vs. Wilmar Cahaya Indonesia
Performance |
| Timeline |
| Akasha Wira International |
| Wilmar Cahaya Indonesia |
Akasha Wira and Wilmar Cahaya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Akasha Wira and Wilmar Cahaya
The main advantage of trading using opposite Akasha Wira and Wilmar Cahaya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akasha Wira position performs unexpectedly, Wilmar Cahaya 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 Wilmar Cahaya will offset losses from the drop in Wilmar Cahaya's long position.| Akasha Wira vs. FKS Food Sejahtera | Akasha Wira vs. Wilmar Cahaya Indonesia | Akasha Wira vs. Polychem Indonesia Tbk | Akasha Wira vs. Astra Graphia Tbk |
| Wilmar Cahaya vs. Austindo Nusantara Jaya | Wilmar Cahaya vs. Mahkota Group Tbk | Wilmar Cahaya vs. Borneo Olah Sarana | Wilmar Cahaya vs. Estika Tata Tiara |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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