Correlation Between Protech Mitra and Ashmore Asset
Can any of the company-specific risk be diversified away by investing in both Protech Mitra and Ashmore Asset 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 Protech Mitra and Ashmore Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Protech Mitra Perkasa and Ashmore Asset Management, you can compare the effects of market volatilities on Protech Mitra and Ashmore Asset 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 Protech Mitra with a short position of Ashmore Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Protech Mitra and Ashmore Asset.
Diversification Opportunities for Protech Mitra and Ashmore Asset
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Protech and Ashmore is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Protech Mitra Perkasa and Ashmore Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ashmore Asset Management and Protech Mitra 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 Protech Mitra Perkasa are associated (or correlated) with Ashmore Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ashmore Asset Management has no effect on the direction of Protech Mitra i.e., Protech Mitra and Ashmore Asset go up and down completely randomly.
Pair Corralation between Protech Mitra and Ashmore Asset
Assuming the 90 days trading horizon Protech Mitra Perkasa is expected to under-perform the Ashmore Asset. In addition to that, Protech Mitra is 2.03 times more volatile than Ashmore Asset Management. It trades about -0.02 of its total potential returns per unit of risk. Ashmore Asset Management is currently generating about -0.03 per unit of volatility. If you would invest 123,977 in Ashmore Asset Management on August 27, 2024 and sell it today you would lose (51,977) from holding Ashmore Asset Management or give up 41.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Protech Mitra Perkasa vs. Ashmore Asset Management
Performance |
| Timeline |
| Protech Mitra Perkasa |
| Ashmore Asset Management |
Protech Mitra and Ashmore Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Protech Mitra and Ashmore Asset
The main advantage of trading using opposite Protech Mitra and Ashmore Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Protech Mitra position performs unexpectedly, Ashmore Asset 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 Ashmore Asset will offset losses from the drop in Ashmore Asset's long position.The idea behind Protech Mitra Perkasa and Ashmore Asset Management pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Ashmore Asset vs. Bank Amar Indonesia | Ashmore Asset vs. Bhakti Multi Artha | Ashmore Asset vs. Mahaka Radio Integra | Ashmore Asset vs. Ateliers Mecaniques DIndonesie |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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