Correlation Between Sentul City and Astra Graphia
Can any of the company-specific risk be diversified away by investing in both Sentul City and Astra Graphia 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 Sentul City and Astra Graphia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sentul City Tbk and Astra Graphia Tbk, you can compare the effects of market volatilities on Sentul City and Astra Graphia 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 Sentul City with a short position of Astra Graphia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sentul City and Astra Graphia.
Diversification Opportunities for Sentul City and Astra Graphia
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sentul and Astra is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Sentul City Tbk and Astra Graphia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astra Graphia Tbk and Sentul City 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 Sentul City Tbk are associated (or correlated) with Astra Graphia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astra Graphia Tbk has no effect on the direction of Sentul City i.e., Sentul City and Astra Graphia go up and down completely randomly.
Pair Corralation between Sentul City and Astra Graphia
Assuming the 90 days trading horizon Sentul City Tbk is expected to generate 1.93 times more return on investment than Astra Graphia. However, Sentul City is 1.93 times more volatile than Astra Graphia Tbk. It trades about 0.01 of its potential returns per unit of risk. Astra Graphia Tbk is currently generating about 0.01 per unit of risk. If you would invest 5,000 in Sentul City Tbk on September 2, 2024 and sell it today you would lose (200.00) from holding Sentul City Tbk or give up 4.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Sentul City Tbk vs. Astra Graphia Tbk
Performance |
| Timeline |
| Sentul City Tbk |
| Astra Graphia Tbk |
Sentul City and Astra Graphia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sentul City and Astra Graphia
The main advantage of trading using opposite Sentul City and Astra Graphia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sentul City position performs unexpectedly, Astra Graphia 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 Astra Graphia will offset losses from the drop in Astra Graphia's long position.| Sentul City vs. Alam Sutera Realty | Sentul City vs. Kawasan Industri Jababeka | Sentul City vs. Lippo Karawaci Tbk | Sentul City vs. Ciputra Development Tbk |
| Astra Graphia vs. Matahari Department Store | Astra Graphia vs. Multi Medika Internasional | Astra Graphia vs. Visi Media Asia | Astra Graphia vs. Bayan Resources 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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