Correlation Between Asiaplast Industries and Indal Aluminium
Can any of the company-specific risk be diversified away by investing in both Asiaplast Industries and Indal Aluminium 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 Indal Aluminium 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 Indal Aluminium Industry, you can compare the effects of market volatilities on Asiaplast Industries and Indal Aluminium 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 Indal Aluminium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asiaplast Industries and Indal Aluminium.
Diversification Opportunities for Asiaplast Industries and Indal Aluminium
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Asiaplast and Indal is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Asiaplast Industries Tbk and Indal Aluminium Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indal Aluminium Industry 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 Indal Aluminium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indal Aluminium Industry has no effect on the direction of Asiaplast Industries i.e., Asiaplast Industries and Indal Aluminium go up and down completely randomly.
Pair Corralation between Asiaplast Industries and Indal Aluminium
Assuming the 90 days trading horizon Asiaplast Industries Tbk is expected to generate 1.28 times more return on investment than Indal Aluminium. However, Asiaplast Industries is 1.28 times more volatile than Indal Aluminium Industry. It trades about 0.07 of its potential returns per unit of risk. Indal Aluminium Industry is currently generating about -0.06 per unit of risk. If you would invest 24,173 in Asiaplast Industries Tbk on November 5, 2024 and sell it today you would earn a total of 31,327 from holding Asiaplast Industries Tbk or generate 129.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asiaplast Industries Tbk vs. Indal Aluminium Industry
Performance |
| Timeline |
| Asiaplast Industries Tbk |
| Indal Aluminium Industry |
Asiaplast Industries and Indal Aluminium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asiaplast Industries and Indal Aluminium
The main advantage of trading using opposite Asiaplast Industries and Indal Aluminium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asiaplast Industries position performs unexpectedly, Indal Aluminium 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 Indal Aluminium will offset losses from the drop in Indal Aluminium'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 |
| Indal Aluminium vs. Intanwijaya Internasional Tbk | Indal Aluminium vs. Alumindo Light Metal | Indal Aluminium vs. Champion Pacific Indonesia | Indal Aluminium vs. Betonjaya Manunggal 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |