Correlation Between Pan Brothers and Asia Pacific
Can any of the company-specific risk be diversified away by investing in both Pan Brothers and Asia Pacific 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 Pan Brothers and Asia Pacific into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pan Brothers Tbk and Asia Pacific Fibers, you can compare the effects of market volatilities on Pan Brothers and Asia Pacific 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 Pan Brothers with a short position of Asia Pacific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pan Brothers and Asia Pacific.
Diversification Opportunities for Pan Brothers and Asia Pacific
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Pan and Asia is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Pan Brothers Tbk and Asia Pacific Fibers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Pacific Fibers and Pan Brothers 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 Pan Brothers Tbk are associated (or correlated) with Asia Pacific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Pacific Fibers has no effect on the direction of Pan Brothers i.e., Pan Brothers and Asia Pacific go up and down completely randomly.
Pair Corralation between Pan Brothers and Asia Pacific
Assuming the 90 days trading horizon Pan Brothers Tbk is expected to generate 0.64 times more return on investment than Asia Pacific. However, Pan Brothers Tbk is 1.56 times less risky than Asia Pacific. It trades about 0.3 of its potential returns per unit of risk. Asia Pacific Fibers is currently generating about -0.12 per unit of risk. If you would invest 2,000 in Pan Brothers Tbk on August 25, 2024 and sell it today you would earn a total of 300.00 from holding Pan Brothers Tbk or generate 15.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Pan Brothers Tbk vs. Asia Pacific Fibers
Performance |
| Timeline |
| Pan Brothers Tbk |
| Asia Pacific Fibers |
Pan Brothers and Asia Pacific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pan Brothers and Asia Pacific
The main advantage of trading using opposite Pan Brothers and Asia Pacific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pan Brothers position performs unexpectedly, Asia Pacific 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 Asia Pacific will offset losses from the drop in Asia Pacific's long position.| Pan Brothers vs. Ricky Putra Globalindo | Pan Brothers vs. Asia Pacific Fibers | Pan Brothers vs. Asia Pacific Investama | Pan Brothers vs. Prima Alloy Steel |
| Asia Pacific vs. PT Sreeya Sewu | Asia Pacific vs. Multistrada Arah Sarana | Asia Pacific vs. Polychem Indonesia Tbk | Asia Pacific vs. Pan Brothers 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |