Correlation Between Astra International and BASE
Can any of the company-specific risk be diversified away by investing in both Astra International and BASE 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 Astra International and BASE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Astra International Tbk and BASE Inc, you can compare the effects of market volatilities on Astra International and BASE 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 Astra International with a short position of BASE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra International and BASE.
Diversification Opportunities for Astra International and BASE
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Astra and BASE is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Astra International Tbk and BASE Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BASE Inc and Astra International 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 Astra International Tbk are associated (or correlated) with BASE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BASE Inc has no effect on the direction of Astra International i.e., Astra International and BASE go up and down completely randomly.
Pair Corralation between Astra International and BASE
Assuming the 90 days horizon Astra International Tbk is expected to under-perform the BASE. In addition to that, Astra International is 2.83 times more volatile than BASE Inc. It trades about -0.11 of its total potential returns per unit of risk. BASE Inc is currently generating about -0.22 per unit of volatility. If you would invest 204.00 in BASE Inc on November 2, 2024 and sell it today you would lose (5.00) from holding BASE Inc or give up 2.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Astra International Tbk vs. BASE Inc
Performance |
| Timeline |
| Astra International Tbk |
| BASE Inc |
Astra International and BASE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astra International and BASE
The main advantage of trading using opposite Astra International and BASE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra International position performs unexpectedly, BASE 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 BASE will offset losses from the drop in BASE's long position.| Astra International vs. Sumitomo Chemical Co | Astra International vs. AB SKF | Astra International vs. Adecco Group | Astra International vs. Nitto Denko Corp |
| BASE vs. CurrentC Power | BASE vs. Agent Information Software | BASE vs. Auddia Inc | BASE vs. Maxwell Resource |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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