Correlation Between PT Astra and Cannara Biotech
Can any of the company-specific risk be diversified away by investing in both PT Astra and Cannara Biotech 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 Cannara Biotech 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 Cannara Biotech, you can compare the effects of market volatilities on PT Astra and Cannara Biotech 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 Cannara Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Astra and Cannara Biotech.
Diversification Opportunities for PT Astra and Cannara Biotech
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between PTAIF and Cannara is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and Cannara Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cannara Biotech 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 Cannara Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cannara Biotech has no effect on the direction of PT Astra i.e., PT Astra and Cannara Biotech go up and down completely randomly.
Pair Corralation between PT Astra and Cannara Biotech
Assuming the 90 days horizon PT Astra International is expected to under-perform the Cannara Biotech. But the pink sheet apears to be less risky and, when comparing its historical volatility, PT Astra International is 2.09 times less risky than Cannara Biotech. The pink sheet trades about -0.18 of its potential returns per unit of risk. The Cannara Biotech is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 47.00 in Cannara Biotech on October 25, 2024 and sell it today you would earn a total of 15.00 from holding Cannara Biotech or generate 31.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.33% |
| Values | Daily Returns |
PT Astra International vs. Cannara Biotech
Performance |
| Timeline |
| PT Astra International |
| Cannara Biotech |
PT Astra and Cannara Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Astra and Cannara Biotech
The main advantage of trading using opposite PT Astra and Cannara Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Astra position performs unexpectedly, Cannara Biotech 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 Cannara Biotech will offset losses from the drop in Cannara Biotech's long position.| PT Astra vs. Allison Transmission Holdings | PT Astra vs. Luminar Technologies | PT Astra vs. Quantumscape Corp | PT Astra vs. Lear Corporation |
| Cannara Biotech vs. Benchmark Botanics | Cannara Biotech vs. Speakeasy Cannabis Club | Cannara Biotech vs. City View Green | Cannara Biotech vs. BC Craft Supply |
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 Positions Ratings module to 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.
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