Correlation Between PT Astra and NuVim
Can any of the company-specific risk be diversified away by investing in both PT Astra and NuVim 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 PT Astra and NuVim into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Astra International and NuVim Inc, you can compare the effects of market volatilities on PT Astra and NuVim 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 PT Astra with a short position of NuVim. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Astra and NuVim.
Diversification Opportunities for PT Astra and NuVim
Modest diversification
The 3 months correlation between ASII and NuVim is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and NuVim Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NuVim Inc and PT Astra 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 PT Astra International are associated (or correlated) with NuVim. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NuVim Inc has no effect on the direction of PT Astra i.e., PT Astra and NuVim go up and down completely randomly.
Pair Corralation between PT Astra and NuVim
Given the investment horizon of 90 days PT Astra is expected to generate 5.53 times less return on investment than NuVim. In addition to that, PT Astra is 2.93 times more volatile than NuVim Inc. It trades about 0.01 of its total potential returns per unit of risk. NuVim Inc is currently generating about 0.21 per unit of volatility. If you would invest 0.30 in NuVim Inc on September 2, 2024 and sell it today you would earn a total of 0.10 from holding NuVim Inc or generate 33.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Astra International vs. NuVim Inc
Performance |
| Timeline |
| PT Astra International |
| NuVim Inc |
PT Astra and NuVim Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Astra and NuVim
The main advantage of trading using opposite PT Astra and NuVim positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Astra position performs unexpectedly, NuVim 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 NuVim will offset losses from the drop in NuVim's long position.| PT Astra vs. Embotelladora Andina SA | PT Astra vs. Embotelladora Andina SA | PT Astra vs. Apple Rush | PT Astra vs. Alkame Holdings |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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