Correlation Between Supra Boga and Astra International
Can any of the company-specific risk be diversified away by investing in both Supra Boga and Astra International 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 Supra Boga and Astra International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Supra Boga Lestari and Astra International Tbk, you can compare the effects of market volatilities on Supra Boga and Astra International 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 Supra Boga with a short position of Astra International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Supra Boga and Astra International.
Diversification Opportunities for Supra Boga and Astra International
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Supra and Astra is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Supra Boga Lestari and Astra International Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astra International Tbk and Supra Boga 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 Supra Boga Lestari are associated (or correlated) with Astra International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astra International Tbk has no effect on the direction of Supra Boga i.e., Supra Boga and Astra International go up and down completely randomly.
Pair Corralation between Supra Boga and Astra International
Assuming the 90 days trading horizon Supra Boga Lestari is expected to under-perform the Astra International. In addition to that, Supra Boga is 1.45 times more volatile than Astra International Tbk. It trades about -0.04 of its total potential returns per unit of risk. Astra International Tbk is currently generating about 0.03 per unit of volatility. If you would invest 460,112 in Astra International Tbk on September 13, 2024 and sell it today you would earn a total of 64,888 from holding Astra International Tbk or generate 14.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Supra Boga Lestari vs. Astra International Tbk
Performance |
| Timeline |
| Supra Boga Lestari |
| Astra International Tbk |
Supra Boga and Astra International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Supra Boga and Astra International
The main advantage of trading using opposite Supra Boga and Astra International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Supra Boga position performs unexpectedly, Astra International 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 Astra International will offset losses from the drop in Astra International's long position.| Supra Boga vs. Nippon Indosari Corpindo | Supra Boga vs. Ramayana Lestari Sentosa | Supra Boga vs. Midi Utama Indonesia | Supra Boga vs. Hero Supermarket Tbk |
| Astra International vs. Telkom Indonesia Tbk | Astra International vs. Bank Mandiri Persero | Astra International vs. Bank Central Asia | Astra International vs. PT Indofood Sukses |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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