Correlation Between PT Astra and Sovos Brands
Can any of the company-specific risk be diversified away by investing in both PT Astra and Sovos Brands 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 Sovos Brands 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 Sovos Brands, you can compare the effects of market volatilities on PT Astra and Sovos Brands 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 Sovos Brands. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Astra and Sovos Brands.
Diversification Opportunities for PT Astra and Sovos Brands
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between PTAIF and Sovos is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and Sovos Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sovos Brands 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 Sovos Brands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sovos Brands has no effect on the direction of PT Astra i.e., PT Astra and Sovos Brands go up and down completely randomly.
Pair Corralation between PT Astra and Sovos Brands
Assuming the 90 days horizon PT Astra is expected to generate 2.3 times less return on investment than Sovos Brands. In addition to that, PT Astra is 2.63 times more volatile than Sovos Brands. It trades about 0.02 of its total potential returns per unit of risk. Sovos Brands is currently generating about 0.14 per unit of volatility. If you would invest 1,354 in Sovos Brands on August 27, 2024 and sell it today you would earn a total of 508.00 from holding Sovos Brands or generate 37.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 42.55% |
| Values | Daily Returns |
PT Astra International vs. Sovos Brands
Performance |
| Timeline |
| PT Astra International |
| Sovos Brands |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
PT Astra and Sovos Brands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Astra and Sovos Brands
The main advantage of trading using opposite PT Astra and Sovos Brands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Astra position performs unexpectedly, Sovos Brands 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 Sovos Brands will offset losses from the drop in Sovos Brands' long position.| PT Astra vs. Allison Transmission Holdings | PT Astra vs. Luminar Technologies | PT Astra vs. Lear Corporation | PT Astra vs. BorgWarner |
| Sovos Brands vs. Seneca Foods Corp | Sovos Brands vs. J J Snack | Sovos Brands vs. Simply Good Foods | Sovos Brands vs. Central Garden Pet |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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