Correlation Between Akr Corporindo and Indocement Tunggal
Can any of the company-specific risk be diversified away by investing in both Akr Corporindo and Indocement Tunggal 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 Indocement Tunggal 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 Indocement Tunggal Prakarsa, you can compare the effects of market volatilities on Akr Corporindo and Indocement Tunggal 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 Indocement Tunggal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akr Corporindo and Indocement Tunggal.
Diversification Opportunities for Akr Corporindo and Indocement Tunggal
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Akr and Indocement is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Akr Corporindo Tbk and Indocement Tunggal Prakarsa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indocement Tunggal 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 Indocement Tunggal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indocement Tunggal has no effect on the direction of Akr Corporindo i.e., Akr Corporindo and Indocement Tunggal go up and down completely randomly.
Pair Corralation between Akr Corporindo and Indocement Tunggal
Assuming the 90 days trading horizon Akr Corporindo Tbk is expected to generate 2.04 times more return on investment than Indocement Tunggal. However, Akr Corporindo is 2.04 times more volatile than Indocement Tunggal Prakarsa. It trades about 0.11 of its potential returns per unit of risk. Indocement Tunggal Prakarsa is currently generating about -0.54 per unit of risk. If you would invest 104,500 in Akr Corporindo Tbk on November 5, 2024 and sell it today you would earn a total of 5,500 from holding Akr Corporindo Tbk or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Akr Corporindo Tbk vs. Indocement Tunggal Prakarsa
Performance |
| Timeline |
| Akr Corporindo Tbk |
| Indocement Tunggal |
Akr Corporindo and Indocement Tunggal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Akr Corporindo and Indocement Tunggal
The main advantage of trading using opposite Akr Corporindo and Indocement Tunggal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akr Corporindo position performs unexpectedly, Indocement Tunggal 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 Indocement Tunggal will offset losses from the drop in Indocement Tunggal's long position.| Akr Corporindo vs. Samudera Indonesia Tbk | Akr Corporindo vs. Weha Transportasi Indonesia | Akr Corporindo vs. Rig Tenders Tbk | Akr Corporindo vs. Total Bangun Persada |
| Indocement Tunggal vs. Semen Indonesia Persero | Indocement Tunggal vs. United Tractors Tbk | Indocement Tunggal vs. PT Indofood Sukses | Indocement Tunggal vs. Kalbe Farma 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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