Correlation Between PT Astra and Green Globe
Can any of the company-specific risk be diversified away by investing in both PT Astra and Green Globe 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 Green Globe 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 Green Globe International, you can compare the effects of market volatilities on PT Astra and Green Globe 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 Green Globe. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Astra and Green Globe.
Diversification Opportunities for PT Astra and Green Globe
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PTAIF and Green is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and Green Globe International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Green Globe International 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 Green Globe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Green Globe International has no effect on the direction of PT Astra i.e., PT Astra and Green Globe go up and down completely randomly.
Pair Corralation between PT Astra and Green Globe
Assuming the 90 days horizon PT Astra International is expected to under-perform the Green Globe. But the pink sheet apears to be less risky and, when comparing its historical volatility, PT Astra International is 3.96 times less risky than Green Globe. The pink sheet trades about -0.01 of its potential returns per unit of risk. The Green Globe International is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 0.14 in Green Globe International on August 31, 2024 and sell it today you would lose (0.10) from holding Green Globe International or give up 71.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 51.74% |
| Values | Daily Returns |
PT Astra International vs. Green Globe International
Performance |
| Timeline |
| PT Astra International |
| Green Globe International |
PT Astra and Green Globe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Astra and Green Globe
The main advantage of trading using opposite PT Astra and Green Globe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Astra position performs unexpectedly, Green Globe 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 Green Globe will offset losses from the drop in Green Globe's long position.| PT Astra vs. Allison Transmission Holdings | PT Astra vs. Luminar Technologies | PT Astra vs. Quantumscape Corp | PT Astra vs. Lear Corporation |
| Green Globe vs. Imperial Brands PLC | Green Globe vs. Turning Point Brands | Green Globe vs. Universal | Green Globe vs. Japan Tobacco ADR |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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