Correlation Between Nusa Palapa and Akasha Wira
Can any of the company-specific risk be diversified away by investing in both Nusa Palapa and Akasha Wira 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 Nusa Palapa and Akasha Wira into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nusa Palapa Gemilang and Akasha Wira International, you can compare the effects of market volatilities on Nusa Palapa and Akasha Wira 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 Nusa Palapa with a short position of Akasha Wira. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nusa Palapa and Akasha Wira.
Diversification Opportunities for Nusa Palapa and Akasha Wira
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nusa and Akasha is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Nusa Palapa Gemilang and Akasha Wira International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akasha Wira International and Nusa Palapa 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 Nusa Palapa Gemilang are associated (or correlated) with Akasha Wira. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akasha Wira International has no effect on the direction of Nusa Palapa i.e., Nusa Palapa and Akasha Wira go up and down completely randomly.
Pair Corralation between Nusa Palapa and Akasha Wira
Assuming the 90 days trading horizon Nusa Palapa Gemilang is expected to under-perform the Akasha Wira. In addition to that, Nusa Palapa is 3.38 times more volatile than Akasha Wira International. It trades about -0.03 of its total potential returns per unit of risk. Akasha Wira International is currently generating about 0.0 per unit of volatility. If you would invest 1,000,000 in Akasha Wira International on August 25, 2024 and sell it today you would lose (17,500) from holding Akasha Wira International or give up 1.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nusa Palapa Gemilang vs. Akasha Wira International
Performance |
| Timeline |
| Nusa Palapa Gemilang |
| Akasha Wira International |
Nusa Palapa and Akasha Wira Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nusa Palapa and Akasha Wira
The main advantage of trading using opposite Nusa Palapa and Akasha Wira positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nusa Palapa position performs unexpectedly, Akasha Wira 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 Akasha Wira will offset losses from the drop in Akasha Wira's long position.| Nusa Palapa vs. Berkah Beton Sadaya | Nusa Palapa vs. Triputra Agro Persada | Nusa Palapa vs. PT Sunter Lakeside | Nusa Palapa vs. Ladangbaja Murni PT |
| Akasha Wira vs. Charoen Pokphand Indonesia | Akasha Wira vs. Kalbe Farma Tbk | Akasha Wira vs. Indofood Cbp Sukses | Akasha Wira vs. Akr Corporindo 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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