Correlation Between Astra International and Perusahaan Gas
Can any of the company-specific risk be diversified away by investing in both Astra International and Perusahaan Gas 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 Perusahaan Gas 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 Perusahaan Gas Negara, you can compare the effects of market volatilities on Astra International and Perusahaan Gas 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 Perusahaan Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra International and Perusahaan Gas.
Diversification Opportunities for Astra International and Perusahaan Gas
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Astra and Perusahaan is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Astra International Tbk and Perusahaan Gas Negara in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perusahaan Gas Negara 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 Perusahaan Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perusahaan Gas Negara has no effect on the direction of Astra International i.e., Astra International and Perusahaan Gas go up and down completely randomly.
Pair Corralation between Astra International and Perusahaan Gas
Assuming the 90 days trading horizon Astra International Tbk is expected to generate 0.86 times more return on investment than Perusahaan Gas. However, Astra International Tbk is 1.16 times less risky than Perusahaan Gas. It trades about 0.01 of its potential returns per unit of risk. Perusahaan Gas Negara is currently generating about 0.01 per unit of risk. If you would invest 476,327 in Astra International Tbk on August 27, 2024 and sell it today you would earn a total of 14,673 from holding Astra International Tbk or generate 3.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astra International Tbk vs. Perusahaan Gas Negara
Performance |
| Timeline |
| Astra International Tbk |
| Perusahaan Gas Negara |
Astra International and Perusahaan Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astra International and Perusahaan Gas
The main advantage of trading using opposite Astra International and Perusahaan Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra International position performs unexpectedly, Perusahaan Gas 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 Perusahaan Gas will offset losses from the drop in Perusahaan Gas' 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 |
| Perusahaan Gas vs. Aneka Tambang Persero | Perusahaan Gas vs. Bukit Asam Tbk | Perusahaan Gas vs. Telkom Indonesia Tbk | Perusahaan Gas vs. Astra International 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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