Correlation Between Astra Graphia and Millennium Pharmacon
Can any of the company-specific risk be diversified away by investing in both Astra Graphia and Millennium Pharmacon 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 Millennium Pharmacon 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 Millennium Pharmacon International, you can compare the effects of market volatilities on Astra Graphia and Millennium Pharmacon 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 Millennium Pharmacon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra Graphia and Millennium Pharmacon.
Diversification Opportunities for Astra Graphia and Millennium Pharmacon
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Astra and Millennium is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Astra Graphia Tbk and Millennium Pharmacon Internati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Millennium Pharmacon 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 Millennium Pharmacon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Millennium Pharmacon has no effect on the direction of Astra Graphia i.e., Astra Graphia and Millennium Pharmacon go up and down completely randomly.
Pair Corralation between Astra Graphia and Millennium Pharmacon
Assuming the 90 days trading horizon Astra Graphia Tbk is expected to under-perform the Millennium Pharmacon. But the stock apears to be less risky and, when comparing its historical volatility, Astra Graphia Tbk is 4.09 times less risky than Millennium Pharmacon. The stock trades about -0.18 of its potential returns per unit of risk. The Millennium Pharmacon International is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 14,300 in Millennium Pharmacon International on August 30, 2024 and sell it today you would earn a total of 900.00 from holding Millennium Pharmacon International or generate 6.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astra Graphia Tbk vs. Millennium Pharmacon Internati
Performance |
| Timeline |
| Astra Graphia Tbk |
| Millennium Pharmacon |
Astra Graphia and Millennium Pharmacon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astra Graphia and Millennium Pharmacon
The main advantage of trading using opposite Astra Graphia and Millennium Pharmacon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra Graphia position performs unexpectedly, Millennium Pharmacon 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 Millennium Pharmacon will offset losses from the drop in Millennium Pharmacon's long position.| Astra Graphia vs. Pelayaran Nelly Dwi | Astra Graphia vs. Buana Listya Tama | Astra Graphia vs. Mitrabahtera Segara Sejati | Astra Graphia vs. Trans Power Marine |
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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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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