Correlation Between Astra Graphia and Prodia Widyahusada
Can any of the company-specific risk be diversified away by investing in both Astra Graphia and Prodia Widyahusada 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 Astra Graphia and Prodia Widyahusada into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astra Graphia Tbk and Prodia Widyahusada Tbk, you can compare the effects of market volatilities on Astra Graphia and Prodia Widyahusada 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 Astra Graphia with a short position of Prodia Widyahusada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra Graphia and Prodia Widyahusada.
Diversification Opportunities for Astra Graphia and Prodia Widyahusada
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Astra and Prodia is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Astra Graphia Tbk and Prodia Widyahusada Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prodia Widyahusada Tbk and Astra Graphia 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 Astra Graphia Tbk are associated (or correlated) with Prodia Widyahusada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prodia Widyahusada Tbk has no effect on the direction of Astra Graphia i.e., Astra Graphia and Prodia Widyahusada go up and down completely randomly.
Pair Corralation between Astra Graphia and Prodia Widyahusada
Assuming the 90 days trading horizon Astra Graphia Tbk is expected to generate 0.56 times more return on investment than Prodia Widyahusada. However, Astra Graphia Tbk is 1.78 times less risky than Prodia Widyahusada. It trades about 0.01 of its potential returns per unit of risk. Prodia Widyahusada Tbk is currently generating about -0.05 per unit of risk. If you would invest 84,431 in Astra Graphia Tbk on August 29, 2024 and sell it today you would earn a total of 569.00 from holding Astra Graphia Tbk or generate 0.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astra Graphia Tbk vs. Prodia Widyahusada Tbk
Performance |
| Timeline |
| Astra Graphia Tbk |
| Prodia Widyahusada Tbk |
Astra Graphia and Prodia Widyahusada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astra Graphia and Prodia Widyahusada
The main advantage of trading using opposite Astra Graphia and Prodia Widyahusada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra Graphia position performs unexpectedly, Prodia Widyahusada 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 Prodia Widyahusada will offset losses from the drop in Prodia Widyahusada's long position.| Astra Graphia vs. Astra Otoparts Tbk | Astra Graphia vs. Citra Marga Nusaphala | Astra Graphia vs. Hexindo Adiperkasa Tbk | Astra Graphia vs. Metrodata Electronics Tbk |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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