Correlation Between Astra International and Japfa Comfeed
Can any of the company-specific risk be diversified away by investing in both Astra International and Japfa Comfeed 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 Japfa Comfeed 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 Japfa Comfeed Indonesia, you can compare the effects of market volatilities on Astra International and Japfa Comfeed 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 Japfa Comfeed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra International and Japfa Comfeed.
Diversification Opportunities for Astra International and Japfa Comfeed
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Astra and Japfa is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Astra International Tbk and Japfa Comfeed Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Japfa Comfeed Indonesia 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 Japfa Comfeed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Japfa Comfeed Indonesia has no effect on the direction of Astra International i.e., Astra International and Japfa Comfeed go up and down completely randomly.
Pair Corralation between Astra International and Japfa Comfeed
Assuming the 90 days trading horizon Astra International Tbk is expected to generate 0.81 times more return on investment than Japfa Comfeed. However, Astra International Tbk is 1.23 times less risky than Japfa Comfeed. It trades about -0.02 of its potential returns per unit of risk. Japfa Comfeed Indonesia is currently generating about -0.11 per unit of risk. If you would invest 520,000 in Astra International Tbk on August 31, 2024 and sell it today you would lose (5,000) from holding Astra International Tbk or give up 0.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astra International Tbk vs. Japfa Comfeed Indonesia
Performance |
| Timeline |
| Astra International Tbk |
| Japfa Comfeed Indonesia |
Astra International and Japfa Comfeed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astra International and Japfa Comfeed
The main advantage of trading using opposite Astra International and Japfa Comfeed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra International position performs unexpectedly, Japfa Comfeed 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 Japfa Comfeed will offset losses from the drop in Japfa Comfeed's long position.| Astra International vs. Japfa Comfeed Indonesia | Astra International vs. Charoen Pokphand Indonesia | Astra International vs. Erajaya Swasembada Tbk | Astra International vs. Indofood Cbp Sukses |
| Japfa Comfeed vs. Charoen Pokphand Indonesia | Japfa Comfeed vs. Kalbe Farma Tbk | Japfa Comfeed vs. Indofood Cbp Sukses | Japfa Comfeed 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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