Correlation Between PT Astra and Talanx AG
Can any of the company-specific risk be diversified away by investing in both PT Astra and Talanx AG 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 Talanx AG 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 Talanx AG, you can compare the effects of market volatilities on PT Astra and Talanx AG 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 Talanx AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Astra and Talanx AG.
Diversification Opportunities for PT Astra and Talanx AG
Good diversification
The 3 months correlation between ASJA and Talanx is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and Talanx AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Talanx AG 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 Talanx AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Talanx AG has no effect on the direction of PT Astra i.e., PT Astra and Talanx AG go up and down completely randomly.
Pair Corralation between PT Astra and Talanx AG
Assuming the 90 days trading horizon PT Astra is expected to generate 5.26 times less return on investment than Talanx AG. In addition to that, PT Astra is 3.09 times more volatile than Talanx AG. It trades about 0.02 of its total potential returns per unit of risk. Talanx AG is currently generating about 0.33 per unit of volatility. If you would invest 7,140 in Talanx AG on August 28, 2024 and sell it today you would earn a total of 730.00 from holding Talanx AG or generate 10.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Astra International vs. Talanx AG
Performance |
| Timeline |
| PT Astra International |
| Talanx AG |
PT Astra and Talanx AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Astra and Talanx AG
The main advantage of trading using opposite PT Astra and Talanx AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Astra position performs unexpectedly, Talanx AG 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 Talanx AG will offset losses from the drop in Talanx AG's long position.| PT Astra vs. Lion One Metals | PT Astra vs. UNITED RENTALS | PT Astra vs. PLAY2CHILL SA ZY | PT Astra vs. VIAPLAY GROUP AB |
| Talanx AG vs. EAST SIDE GAMES | Talanx AG vs. Hochschild Mining plc | Talanx AG vs. National Beverage Corp | Talanx AG vs. The Boston Beer |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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