Correlation Between Compagnie Plastic and PT Astra
Can any of the company-specific risk be diversified away by investing in both Compagnie Plastic and PT Astra 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 Compagnie Plastic and PT Astra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Compagnie Plastic Omnium and PT Astra International, you can compare the effects of market volatilities on Compagnie Plastic and PT Astra 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 Compagnie Plastic with a short position of PT Astra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Compagnie Plastic and PT Astra.
Diversification Opportunities for Compagnie Plastic and PT Astra
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Compagnie and ASJA is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Compagnie Plastic Omnium and PT Astra International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Astra International and Compagnie Plastic 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 Compagnie Plastic Omnium are associated (or correlated) with PT Astra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Astra International has no effect on the direction of Compagnie Plastic i.e., Compagnie Plastic and PT Astra go up and down completely randomly.
Pair Corralation between Compagnie Plastic and PT Astra
Assuming the 90 days horizon Compagnie Plastic Omnium is expected to under-perform the PT Astra. But the stock apears to be less risky and, when comparing its historical volatility, Compagnie Plastic Omnium is 1.86 times less risky than PT Astra. The stock trades about -0.03 of its potential returns per unit of risk. The PT Astra International is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 32.00 in PT Astra International on August 28, 2024 and sell it today you would lose (3.00) from holding PT Astra International or give up 9.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Compagnie Plastic Omnium vs. PT Astra International
Performance |
| Timeline |
| Compagnie Plastic Omnium |
| PT Astra International |
Compagnie Plastic and PT Astra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Compagnie Plastic and PT Astra
The main advantage of trading using opposite Compagnie Plastic and PT Astra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Compagnie Plastic position performs unexpectedly, PT Astra 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 PT Astra will offset losses from the drop in PT Astra's long position.| Compagnie Plastic vs. Superior Plus Corp | Compagnie Plastic vs. NMI Holdings | Compagnie Plastic vs. Origin Agritech | Compagnie Plastic vs. SIVERS SEMICONDUCTORS AB |
| PT Astra vs. Lion One Metals | PT Astra vs. UNITED RENTALS | PT Astra vs. PLAY2CHILL SA ZY | PT Astra vs. VIAPLAY GROUP AB |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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