Correlation Between Astra International and Astra Graphia
Can any of the company-specific risk be diversified away by investing in both Astra International and Astra Graphia 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 International and Astra Graphia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astra International Tbk and Astra Graphia Tbk, you can compare the effects of market volatilities on Astra International and Astra Graphia 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 International with a short position of Astra Graphia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra International and Astra Graphia.
Diversification Opportunities for Astra International and Astra Graphia
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Astra and Astra is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Astra International Tbk and Astra Graphia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astra Graphia Tbk and Astra International 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 International Tbk are associated (or correlated) with Astra Graphia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astra Graphia Tbk has no effect on the direction of Astra International i.e., Astra International and Astra Graphia go up and down completely randomly.
Pair Corralation between Astra International and Astra Graphia
Assuming the 90 days trading horizon Astra International Tbk is expected to generate 1.37 times more return on investment than Astra Graphia. However, Astra International is 1.37 times more volatile than Astra Graphia Tbk. It trades about 0.01 of its potential returns per unit of risk. Astra Graphia Tbk is currently generating about 0.0 per unit of risk. If you would invest 476,648 in Astra International Tbk on November 5, 2024 and sell it today you would earn a total of 5,352 from holding Astra International Tbk or generate 1.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astra International Tbk vs. Astra Graphia Tbk
Performance |
| Timeline |
| Astra International Tbk |
| Astra Graphia Tbk |
Astra International and Astra Graphia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astra International and Astra Graphia
The main advantage of trading using opposite Astra International and Astra Graphia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra International position performs unexpectedly, Astra Graphia 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 Graphia will offset losses from the drop in Astra Graphia's long position.| Astra International vs. Telkom Indonesia Tbk | Astra International vs. Bank Mandiri Persero | Astra International vs. Bank Central Asia | Astra International vs. PT Indofood Sukses |
| Astra Graphia vs. Astra Otoparts Tbk | Astra Graphia vs. Citra Marga Nusaphala | Astra Graphia vs. Hexindo Adiperkasa Tbk | Astra Graphia vs. Metrodata Electronics 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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