Correlation Between PT Cilacap and Chandra Asri
Can any of the company-specific risk be diversified away by investing in both PT Cilacap and Chandra Asri 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 Chandra Asri 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 Chandra Asri Petrochemical, you can compare the effects of market volatilities on PT Cilacap and Chandra Asri 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 Chandra Asri. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Cilacap and Chandra Asri.
Diversification Opportunities for PT Cilacap and Chandra Asri
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ASHA and Chandra is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding PT Cilacap Samudera and Chandra Asri Petrochemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chandra Asri Petroch 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 Chandra Asri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chandra Asri Petroch has no effect on the direction of PT Cilacap i.e., PT Cilacap and Chandra Asri go up and down completely randomly.
Pair Corralation between PT Cilacap and Chandra Asri
Assuming the 90 days trading horizon PT Cilacap Samudera is expected to generate 1.11 times more return on investment than Chandra Asri. However, PT Cilacap is 1.11 times more volatile than Chandra Asri Petrochemical. It trades about -0.11 of its potential returns per unit of risk. Chandra Asri Petrochemical is currently generating about -0.21 per unit of risk. If you would invest 1,400 in PT Cilacap Samudera on September 1, 2024 and sell it today you would lose (200.00) from holding PT Cilacap Samudera or give up 14.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Cilacap Samudera vs. Chandra Asri Petrochemical
Performance |
| Timeline |
| PT Cilacap Samudera |
| Chandra Asri Petroch |
PT Cilacap and Chandra Asri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Cilacap and Chandra Asri
The main advantage of trading using opposite PT Cilacap and Chandra Asri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Cilacap position performs unexpectedly, Chandra Asri 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 Chandra Asri will offset losses from the drop in Chandra Asri's long position.| PT Cilacap vs. PT Dewi Shri | PT Cilacap vs. Adaro Minerals Indonesia | PT Cilacap vs. Autopedia Sukses Lestari | PT Cilacap vs. Wir Asia Tbk |
| Chandra Asri vs. Barito Pacific Tbk | Chandra Asri vs. Pabrik Kertas Tjiwi | Chandra Asri vs. Charoen Pokphand Indonesia | Chandra Asri vs. Indah Kiat Pulp |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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