Correlation Between PT Astra and Qantas Airways
Can any of the company-specific risk be diversified away by investing in both PT Astra and Qantas Airways 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 Qantas Airways 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 Qantas Airways Limited, you can compare the effects of market volatilities on PT Astra and Qantas Airways 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 Qantas Airways. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Astra and Qantas Airways.
Diversification Opportunities for PT Astra and Qantas Airways
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between PTAIF and Qantas is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and Qantas Airways Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qantas Airways 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 Qantas Airways. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qantas Airways has no effect on the direction of PT Astra i.e., PT Astra and Qantas Airways go up and down completely randomly.
Pair Corralation between PT Astra and Qantas Airways
If you would invest 535.00 in Qantas Airways Limited on September 1, 2024 and sell it today you would earn a total of 5.00 from holding Qantas Airways Limited or generate 0.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Astra International vs. Qantas Airways Limited
Performance |
| Timeline |
| PT Astra International |
| Qantas Airways |
PT Astra and Qantas Airways Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Astra and Qantas Airways
The main advantage of trading using opposite PT Astra and Qantas Airways positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Astra position performs unexpectedly, Qantas Airways 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 Qantas Airways will offset losses from the drop in Qantas Airways' long position.| PT Astra vs. Allison Transmission Holdings | PT Astra vs. Luminar Technologies | PT Astra vs. Quantumscape Corp | PT Astra vs. Lear Corporation |
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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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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