Correlation Between Akr Corporindo and Wilmar Cahaya
Can any of the company-specific risk be diversified away by investing in both Akr Corporindo 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 Akr Corporindo and Wilmar Cahaya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Akr Corporindo Tbk and Wilmar Cahaya Indonesia, you can compare the effects of market volatilities on Akr Corporindo 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 Akr Corporindo with a short position of Wilmar Cahaya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akr Corporindo and Wilmar Cahaya.
Diversification Opportunities for Akr Corporindo and Wilmar Cahaya
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Akr and Wilmar is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Akr Corporindo Tbk 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 Akr Corporindo 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 Akr Corporindo Tbk 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 Akr Corporindo i.e., Akr Corporindo and Wilmar Cahaya go up and down completely randomly.
Pair Corralation between Akr Corporindo and Wilmar Cahaya
Assuming the 90 days trading horizon Akr Corporindo Tbk is expected to generate 1.75 times more return on investment than Wilmar Cahaya. However, Akr Corporindo is 1.75 times more volatile than Wilmar Cahaya Indonesia. It trades about 0.02 of its potential returns per unit of risk. Wilmar Cahaya Indonesia is currently generating about 0.03 per unit of risk. If you would invest 120,101 in Akr Corporindo Tbk on August 26, 2024 and sell it today you would earn a total of 10,399 from holding Akr Corporindo Tbk or generate 8.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Akr Corporindo Tbk vs. Wilmar Cahaya Indonesia
Performance |
| Timeline |
| Akr Corporindo Tbk |
| Wilmar Cahaya Indonesia |
Akr Corporindo and Wilmar Cahaya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Akr Corporindo and Wilmar Cahaya
The main advantage of trading using opposite Akr Corporindo and Wilmar Cahaya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akr Corporindo 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.| Akr Corporindo vs. Charoen Pokphand Indonesia | Akr Corporindo vs. Indocement Tunggal Prakarsa | Akr Corporindo vs. Bumi Serpong Damai | Akr Corporindo vs. Jasa Marga Tbk |
| Wilmar Cahaya vs. Charoen Pokphand Indonesia | Wilmar Cahaya vs. Kalbe Farma Tbk | Wilmar Cahaya vs. Indofood Cbp Sukses | Wilmar Cahaya vs. Akr Corporindo 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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