Correlation Between XL Axiata and Akr Corporindo
Can any of the company-specific risk be diversified away by investing in both XL Axiata and Akr Corporindo 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 XL Axiata and Akr Corporindo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XL Axiata Tbk and Akr Corporindo Tbk, you can compare the effects of market volatilities on XL Axiata and Akr Corporindo 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 XL Axiata with a short position of Akr Corporindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of XL Axiata and Akr Corporindo.
Diversification Opportunities for XL Axiata and Akr Corporindo
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between EXCL and Akr is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding XL Axiata Tbk and Akr Corporindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akr Corporindo Tbk and XL Axiata 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 XL Axiata Tbk are associated (or correlated) with Akr Corporindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akr Corporindo Tbk has no effect on the direction of XL Axiata i.e., XL Axiata and Akr Corporindo go up and down completely randomly.
Pair Corralation between XL Axiata and Akr Corporindo
Assuming the 90 days trading horizon XL Axiata is expected to generate 1.27 times less return on investment than Akr Corporindo. In addition to that, XL Axiata is 1.03 times more volatile than Akr Corporindo Tbk. It trades about 0.01 of its total potential returns per unit of risk. Akr Corporindo Tbk is currently generating about 0.02 per unit of volatility. If you would invest 117,956 in Akr Corporindo Tbk on August 28, 2024 and sell it today you would earn a total of 8,544 from holding Akr Corporindo Tbk or generate 7.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
XL Axiata Tbk vs. Akr Corporindo Tbk
Performance |
| Timeline |
| XL Axiata Tbk |
| Akr Corporindo Tbk |
XL Axiata and Akr Corporindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XL Axiata and Akr Corporindo
The main advantage of trading using opposite XL Axiata and Akr Corporindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XL Axiata position performs unexpectedly, Akr Corporindo 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 Akr Corporindo will offset losses from the drop in Akr Corporindo's long position.| XL Axiata vs. Indosat Tbk | XL Axiata vs. Jasa Marga Tbk | XL Axiata vs. Indocement Tunggal Prakarsa | XL Axiata vs. Semen Indonesia 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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