Correlation Between Astra International and Tigaraksa Satria
Can any of the company-specific risk be diversified away by investing in both Astra International and Tigaraksa Satria 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 Tigaraksa Satria 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 Tigaraksa Satria Tbk, you can compare the effects of market volatilities on Astra International and Tigaraksa Satria 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 Tigaraksa Satria. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra International and Tigaraksa Satria.
Diversification Opportunities for Astra International and Tigaraksa Satria
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Astra and Tigaraksa is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Astra International Tbk and Tigaraksa Satria Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tigaraksa Satria 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 Tigaraksa Satria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tigaraksa Satria Tbk has no effect on the direction of Astra International i.e., Astra International and Tigaraksa Satria go up and down completely randomly.
Pair Corralation between Astra International and Tigaraksa Satria
Assuming the 90 days trading horizon Astra International Tbk is expected to generate 0.61 times more return on investment than Tigaraksa Satria. However, Astra International Tbk is 1.65 times less risky than Tigaraksa Satria. It trades about -0.01 of its potential returns per unit of risk. Tigaraksa Satria Tbk is currently generating about -0.05 per unit of risk. If you would invest 512,500 in Astra International Tbk on September 3, 2024 and sell it today you would lose (2,500) from holding Astra International Tbk or give up 0.49% 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. Tigaraksa Satria Tbk
Performance |
| Timeline |
| Astra International Tbk |
| Tigaraksa Satria Tbk |
Astra International and Tigaraksa Satria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astra International and Tigaraksa Satria
The main advantage of trading using opposite Astra International and Tigaraksa Satria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra International position performs unexpectedly, Tigaraksa Satria 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 Tigaraksa Satria will offset losses from the drop in Tigaraksa Satria'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 |
| Tigaraksa Satria vs. Astra International Tbk | Tigaraksa Satria vs. Unilever Indonesia Tbk | Tigaraksa Satria vs. Telkom Indonesia Tbk | Tigaraksa Satria vs. Bank Mandiri Persero |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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