Correlation Between Asiaplast Industries and Alakasa Industrindo
Can any of the company-specific risk be diversified away by investing in both Asiaplast Industries and Alakasa Industrindo 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 Asiaplast Industries and Alakasa Industrindo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asiaplast Industries Tbk and Alakasa Industrindo Tbk, you can compare the effects of market volatilities on Asiaplast Industries and Alakasa Industrindo 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 Asiaplast Industries with a short position of Alakasa Industrindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asiaplast Industries and Alakasa Industrindo.
Diversification Opportunities for Asiaplast Industries and Alakasa Industrindo
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Asiaplast and Alakasa is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Asiaplast Industries Tbk and Alakasa Industrindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alakasa Industrindo Tbk and Asiaplast Industries 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 Asiaplast Industries Tbk are associated (or correlated) with Alakasa Industrindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alakasa Industrindo Tbk has no effect on the direction of Asiaplast Industries i.e., Asiaplast Industries and Alakasa Industrindo go up and down completely randomly.
Pair Corralation between Asiaplast Industries and Alakasa Industrindo
Assuming the 90 days trading horizon Asiaplast Industries Tbk is expected to under-perform the Alakasa Industrindo. In addition to that, Asiaplast Industries is 1.05 times more volatile than Alakasa Industrindo Tbk. It trades about -0.03 of its total potential returns per unit of risk. Alakasa Industrindo Tbk is currently generating about 0.0 per unit of volatility. If you would invest 34,600 in Alakasa Industrindo Tbk on November 5, 2024 and sell it today you would lose (200.00) from holding Alakasa Industrindo Tbk or give up 0.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asiaplast Industries Tbk vs. Alakasa Industrindo Tbk
Performance |
| Timeline |
| Asiaplast Industries Tbk |
| Alakasa Industrindo Tbk |
Asiaplast Industries and Alakasa Industrindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asiaplast Industries and Alakasa Industrindo
The main advantage of trading using opposite Asiaplast Industries and Alakasa Industrindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asiaplast Industries position performs unexpectedly, Alakasa Industrindo 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 Alakasa Industrindo will offset losses from the drop in Alakasa Industrindo's long position.| Asiaplast Industries vs. Argha Karya Prima | Asiaplast Industries vs. Alumindo Light Metal | Asiaplast Industries vs. Anugerah Kagum Karya | Asiaplast Industries vs. Asahimas Flat Glass |
| Alakasa Industrindo vs. Argha Karya Prima | Alakasa Industrindo vs. Alumindo Light Metal | Alakasa Industrindo vs. Asiaplast Industries Tbk | Alakasa Industrindo vs. Akbar Indomakmur Stimec |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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