Correlation Between Champion Pacific and Acset Indonusa
Can any of the company-specific risk be diversified away by investing in both Champion Pacific and Acset Indonusa 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 Champion Pacific and Acset Indonusa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Champion Pacific Indonesia and Acset Indonusa Tbk, you can compare the effects of market volatilities on Champion Pacific and Acset Indonusa 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 Champion Pacific with a short position of Acset Indonusa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Champion Pacific and Acset Indonusa.
Diversification Opportunities for Champion Pacific and Acset Indonusa
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Champion and Acset is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Champion Pacific Indonesia and Acset Indonusa Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acset Indonusa Tbk and Champion Pacific 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 Champion Pacific Indonesia are associated (or correlated) with Acset Indonusa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acset Indonusa Tbk has no effect on the direction of Champion Pacific i.e., Champion Pacific and Acset Indonusa go up and down completely randomly.
Pair Corralation between Champion Pacific and Acset Indonusa
Assuming the 90 days trading horizon Champion Pacific Indonesia is expected to generate 1.13 times more return on investment than Acset Indonusa. However, Champion Pacific is 1.13 times more volatile than Acset Indonusa Tbk. It trades about 0.14 of its potential returns per unit of risk. Acset Indonusa Tbk is currently generating about -0.14 per unit of risk. If you would invest 50,000 in Champion Pacific Indonesia on September 5, 2024 and sell it today you would earn a total of 3,000 from holding Champion Pacific Indonesia or generate 6.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Champion Pacific Indonesia vs. Acset Indonusa Tbk
Performance |
| Timeline |
| Champion Pacific Ind |
| Acset Indonusa Tbk |
Champion Pacific and Acset Indonusa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Champion Pacific and Acset Indonusa
The main advantage of trading using opposite Champion Pacific and Acset Indonusa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Champion Pacific position performs unexpectedly, Acset Indonusa 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 Acset Indonusa will offset losses from the drop in Acset Indonusa's long position.| Champion Pacific vs. Intanwijaya Internasional Tbk | Champion Pacific vs. Asiaplast Industries Tbk | Champion Pacific vs. Trias Sentosa Tbk | Champion Pacific vs. Lotte Chemical Titan |
| Acset Indonusa vs. Bekasi Fajar Industrial | Acset Indonusa vs. Nusa Raya Cipta | Acset Indonusa vs. Wijaya Karya Beton | Acset Indonusa vs. Agung Podomoro Land |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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