Correlation Between PT Astra and Adia Nutrition
Can any of the company-specific risk be diversified away by investing in both PT Astra and Adia Nutrition 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 Adia Nutrition 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 Adia Nutrition, you can compare the effects of market volatilities on PT Astra and Adia Nutrition 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 Adia Nutrition. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Astra and Adia Nutrition.
Diversification Opportunities for PT Astra and Adia Nutrition
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PTAIF and Adia is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and Adia Nutrition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adia Nutrition 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 Adia Nutrition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adia Nutrition has no effect on the direction of PT Astra i.e., PT Astra and Adia Nutrition go up and down completely randomly.
Pair Corralation between PT Astra and Adia Nutrition
Assuming the 90 days horizon PT Astra is expected to generate 15.07 times less return on investment than Adia Nutrition. But when comparing it to its historical volatility, PT Astra International is 7.29 times less risky than Adia Nutrition. It trades about 0.03 of its potential returns per unit of risk. Adia Nutrition is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1.90 in Adia Nutrition on September 3, 2024 and sell it today you would lose (1.40) from holding Adia Nutrition or give up 73.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 50.97% |
| Values | Daily Returns |
PT Astra International vs. Adia Nutrition
Performance |
| Timeline |
| PT Astra International |
| Adia Nutrition |
PT Astra and Adia Nutrition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Astra and Adia Nutrition
The main advantage of trading using opposite PT Astra and Adia Nutrition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Astra position performs unexpectedly, Adia Nutrition 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 Adia Nutrition will offset losses from the drop in Adia Nutrition's long position.| PT Astra vs. Allison Transmission Holdings | PT Astra vs. Luminar Technologies | PT Astra vs. Quantumscape Corp | PT Astra vs. Lear Corporation |
| Adia Nutrition vs. Asia Carbon Industries | Adia Nutrition vs. Allied Energy | Adia Nutrition vs. A1 Group |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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