Correlation Between Adi Sarana and Wir Asia
Can any of the company-specific risk be diversified away by investing in both Adi Sarana and Wir Asia 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 Adi Sarana and Wir Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adi Sarana Armada and Wir Asia Tbk, you can compare the effects of market volatilities on Adi Sarana and Wir Asia 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 Adi Sarana with a short position of Wir Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adi Sarana and Wir Asia.
Diversification Opportunities for Adi Sarana and Wir Asia
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Adi and Wir is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Adi Sarana Armada and Wir Asia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wir Asia Tbk and Adi Sarana 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 Adi Sarana Armada are associated (or correlated) with Wir Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wir Asia Tbk has no effect on the direction of Adi Sarana i.e., Adi Sarana and Wir Asia go up and down completely randomly.
Pair Corralation between Adi Sarana and Wir Asia
Assuming the 90 days trading horizon Adi Sarana Armada is expected to generate 0.83 times more return on investment than Wir Asia. However, Adi Sarana Armada is 1.2 times less risky than Wir Asia. It trades about 0.0 of its potential returns per unit of risk. Wir Asia Tbk is currently generating about -0.02 per unit of risk. If you would invest 86,881 in Adi Sarana Armada on August 27, 2024 and sell it today you would lose (14,881) from holding Adi Sarana Armada or give up 17.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Adi Sarana Armada vs. Wir Asia Tbk
Performance |
| Timeline |
| Adi Sarana Armada |
| Wir Asia Tbk |
Adi Sarana and Wir Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adi Sarana and Wir Asia
The main advantage of trading using opposite Adi Sarana and Wir Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adi Sarana position performs unexpectedly, Wir Asia 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 Wir Asia will offset losses from the drop in Wir Asia's long position.The idea behind Adi Sarana Armada and Wir Asia Tbk pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Wir Asia vs. Multipolar Technology Tbk | Wir Asia vs. Digital Mediatama Maxima | Wir Asia vs. M Cash Integrasi | Wir Asia vs. NFC Indonesia PT |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| CEOs Directory Screen CEOs from public companies around the world |