Correlation Between Astra International and Yanzhou Coal
Can any of the company-specific risk be diversified away by investing in both Astra International and Yanzhou Coal 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 Yanzhou Coal 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 Yanzhou Coal Mining, you can compare the effects of market volatilities on Astra International and Yanzhou Coal 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 Yanzhou Coal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Astra International and Yanzhou Coal.
Diversification Opportunities for Astra International and Yanzhou Coal
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Astra and Yanzhou is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Astra International Tbk and Yanzhou Coal Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yanzhou Coal Mining 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 Yanzhou Coal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yanzhou Coal Mining has no effect on the direction of Astra International i.e., Astra International and Yanzhou Coal go up and down completely randomly.
Pair Corralation between Astra International and Yanzhou Coal
Assuming the 90 days horizon Astra International Tbk is expected to under-perform the Yanzhou Coal. In addition to that, Astra International is 16.6 times more volatile than Yanzhou Coal Mining. It trades about -0.03 of its total potential returns per unit of risk. Yanzhou Coal Mining is currently generating about -0.21 per unit of volatility. If you would invest 136.00 in Yanzhou Coal Mining on August 31, 2024 and sell it today you would lose (1.00) from holding Yanzhou Coal Mining or give up 0.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Astra International Tbk vs. Yanzhou Coal Mining
Performance |
| Timeline |
| Astra International Tbk |
| Yanzhou Coal Mining |
Astra International and Yanzhou Coal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Astra International and Yanzhou Coal
The main advantage of trading using opposite Astra International and Yanzhou Coal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Astra International position performs unexpectedly, Yanzhou Coal 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 Yanzhou Coal will offset losses from the drop in Yanzhou Coal's long position.| Astra International vs. Allison Transmission Holdings | Astra International vs. Luminar Technologies | Astra International vs. Quantumscape Corp | Astra International vs. Lear Corporation |
| Yanzhou Coal vs. Indo Tambangraya Megah | Yanzhou Coal vs. Adaro Energy Tbk | Yanzhou Coal vs. Thungela Resources Limited | Yanzhou Coal vs. China Coal Energy |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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