Correlation Between PT Cilacap and Astra International
Can any of the company-specific risk be diversified away by investing in both PT Cilacap and Astra International 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 PT Cilacap and Astra International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Cilacap Samudera and Astra International Tbk, you can compare the effects of market volatilities on PT Cilacap and Astra International 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 PT Cilacap with a short position of Astra International. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Cilacap and Astra International.
Diversification Opportunities for PT Cilacap and Astra International
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ASHA and Astra is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding PT Cilacap Samudera and Astra International Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astra International Tbk and PT Cilacap 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 PT Cilacap Samudera are associated (or correlated) with Astra International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astra International Tbk has no effect on the direction of PT Cilacap i.e., PT Cilacap and Astra International go up and down completely randomly.
Pair Corralation between PT Cilacap and Astra International
Assuming the 90 days trading horizon PT Cilacap Samudera is expected to under-perform the Astra International. In addition to that, PT Cilacap is 3.45 times more volatile than Astra International Tbk. It trades about -0.09 of its total potential returns per unit of risk. Astra International Tbk is currently generating about -0.03 per unit of volatility. If you would invest 525,000 in Astra International Tbk on August 29, 2024 and sell it today you would lose (7,500) from holding Astra International Tbk or give up 1.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Cilacap Samudera vs. Astra International Tbk
Performance |
| Timeline |
| PT Cilacap Samudera |
| Astra International Tbk |
PT Cilacap and Astra International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Cilacap and Astra International
The main advantage of trading using opposite PT Cilacap and Astra International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Cilacap position performs unexpectedly, Astra International 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 Astra International will offset losses from the drop in Astra International's long position.| PT Cilacap vs. Bank Central Asia | PT Cilacap vs. Bank Rakyat Indonesia | PT Cilacap vs. Bayan Resources Tbk | PT Cilacap vs. Bank Mandiri Persero |
| Astra International vs. Telkom Indonesia Tbk | Astra International vs. Bank Mandiri Persero | Astra International vs. Bank Central Asia | Astra International vs. PT Indofood Sukses |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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