Correlation Between FKS Food and Akr Corporindo
Can any of the company-specific risk be diversified away by investing in both FKS Food and Akr Corporindo 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 FKS Food and Akr Corporindo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FKS Food Sejahtera and Akr Corporindo Tbk, you can compare the effects of market volatilities on FKS Food and Akr Corporindo 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 FKS Food with a short position of Akr Corporindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of FKS Food and Akr Corporindo.
Diversification Opportunities for FKS Food and Akr Corporindo
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FKS and Akr is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding FKS Food Sejahtera and Akr Corporindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akr Corporindo Tbk and FKS Food 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 FKS Food Sejahtera are associated (or correlated) with Akr Corporindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akr Corporindo Tbk has no effect on the direction of FKS Food i.e., FKS Food and Akr Corporindo go up and down completely randomly.
Pair Corralation between FKS Food and Akr Corporindo
Assuming the 90 days trading horizon FKS Food Sejahtera is expected to under-perform the Akr Corporindo. In addition to that, FKS Food is 1.22 times more volatile than Akr Corporindo Tbk. It trades about -0.01 of its total potential returns per unit of risk. Akr Corporindo Tbk is currently generating about 0.01 per unit of volatility. If you would invest 122,675 in Akr Corporindo Tbk on September 3, 2024 and sell it today you would earn a total of 325.00 from holding Akr Corporindo Tbk or generate 0.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
FKS Food Sejahtera vs. Akr Corporindo Tbk
Performance |
| Timeline |
| FKS Food Sejahtera |
| Akr Corporindo Tbk |
FKS Food and Akr Corporindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FKS Food and Akr Corporindo
The main advantage of trading using opposite FKS Food and Akr Corporindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FKS Food position performs unexpectedly, Akr Corporindo 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 Akr Corporindo will offset losses from the drop in Akr Corporindo's long position.| FKS Food vs. Astra International Tbk | FKS Food vs. Unilever Indonesia Tbk | FKS Food vs. Telkom Indonesia Tbk | FKS Food vs. Bank Mandiri Persero |
| Akr Corporindo vs. Charoen Pokphand Indonesia | Akr Corporindo vs. Indocement Tunggal Prakarsa | Akr Corporindo vs. Bumi Serpong Damai | Akr Corporindo vs. Jasa Marga Tbk |
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.
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