Correlation Between PT Astra and Atlantic Coastal
Can any of the company-specific risk be diversified away by investing in both PT Astra and Atlantic Coastal 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 PT Astra and Atlantic Coastal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Astra International and Atlantic Coastal Acquisition, you can compare the effects of market volatilities on PT Astra and Atlantic Coastal 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 PT Astra with a short position of Atlantic Coastal. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Astra and Atlantic Coastal.
Diversification Opportunities for PT Astra and Atlantic Coastal
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PTAIF and Atlantic is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and Atlantic Coastal Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Atlantic Coastal Acq and PT Astra 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 PT Astra International are associated (or correlated) with Atlantic Coastal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Atlantic Coastal Acq has no effect on the direction of PT Astra i.e., PT Astra and Atlantic Coastal go up and down completely randomly.
Pair Corralation between PT Astra and Atlantic Coastal
Assuming the 90 days horizon PT Astra is expected to generate 21.78 times less return on investment than Atlantic Coastal. But when comparing it to its historical volatility, PT Astra International is 5.17 times less risky than Atlantic Coastal. It trades about 0.03 of its potential returns per unit of risk. Atlantic Coastal Acquisition is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 6.01 in Atlantic Coastal Acquisition on August 30, 2024 and sell it today you would lose (2.34) from holding Atlantic Coastal Acquisition or give up 38.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 33.33% |
| Values | Daily Returns |
PT Astra International vs. Atlantic Coastal Acquisition
Performance |
| Timeline |
| PT Astra International |
| Atlantic Coastal Acq |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
PT Astra and Atlantic Coastal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Astra and Atlantic Coastal
The main advantage of trading using opposite PT Astra and Atlantic Coastal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Astra position performs unexpectedly, Atlantic Coastal 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 Atlantic Coastal will offset losses from the drop in Atlantic Coastal's long position.| PT Astra vs. Allison Transmission Holdings | PT Astra vs. Luminar Technologies | PT Astra vs. Quantumscape Corp | PT Astra vs. Lear Corporation |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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