Correlation Between Astra International and Kalbe Farma
Can any of the company-specific risk be diversified away by investing in both Astra International and Kalbe Farma 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 Kalbe Farma 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 Kalbe Farma Tbk, you can compare the effects of market volatilities on Astra International and Kalbe Farma 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 Kalbe Farma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra International and Kalbe Farma.
Diversification Opportunities for Astra International and Kalbe Farma
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Astra and Kalbe is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Astra International Tbk and Kalbe Farma Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kalbe Farma 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 Kalbe Farma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kalbe Farma Tbk has no effect on the direction of Astra International i.e., Astra International and Kalbe Farma go up and down completely randomly.
Pair Corralation between Astra International and Kalbe Farma
Assuming the 90 days trading horizon Astra International Tbk is expected to generate 0.78 times more return on investment than Kalbe Farma. However, Astra International Tbk is 1.28 times less risky than Kalbe Farma. It trades about -0.27 of its potential returns per unit of risk. Kalbe Farma Tbk is currently generating about -0.29 per unit of risk. If you would invest 525,000 in Astra International Tbk on August 27, 2024 and sell it today you would lose (34,000) from holding Astra International Tbk or give up 6.48% 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. Kalbe Farma Tbk
Performance |
| Timeline |
| Astra International Tbk |
| Kalbe Farma Tbk |
Astra International and Kalbe Farma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astra International and Kalbe Farma
The main advantage of trading using opposite Astra International and Kalbe Farma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra International position performs unexpectedly, Kalbe Farma 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 Kalbe Farma will offset losses from the drop in Kalbe Farma'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 |
| Kalbe Farma vs. PT Indofood Sukses | Kalbe Farma vs. Unilever Indonesia Tbk | Kalbe Farma vs. Semen Indonesia Persero | Kalbe Farma vs. United Tractors 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |