Correlation Between Nippon Indosari and Astra International
Can any of the company-specific risk be diversified away by investing in both Nippon Indosari 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 Nippon Indosari and Astra International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nippon Indosari Corpindo and Astra International Tbk, you can compare the effects of market volatilities on Nippon Indosari 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 Nippon Indosari with a short position of Astra International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nippon Indosari and Astra International.
Diversification Opportunities for Nippon Indosari and Astra International
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Nippon and Astra is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Nippon Indosari Corpindo 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 Nippon Indosari 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 Nippon Indosari Corpindo 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 Nippon Indosari i.e., Nippon Indosari and Astra International go up and down completely randomly.
Pair Corralation between Nippon Indosari and Astra International
Assuming the 90 days trading horizon Nippon Indosari is expected to generate 122.23 times less return on investment than Astra International. But when comparing it to its historical volatility, Nippon Indosari Corpindo is 1.49 times less risky than Astra International. It trades about 0.0 of its potential returns per unit of risk. Astra International Tbk is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 433,465 in Astra International Tbk on September 12, 2024 and sell it today you would earn a total of 86,535 from holding Astra International Tbk or generate 19.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nippon Indosari Corpindo vs. Astra International Tbk
Performance |
| Timeline |
| Nippon Indosari Corpindo |
| Astra International Tbk |
Nippon Indosari and Astra International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nippon Indosari and Astra International
The main advantage of trading using opposite Nippon Indosari and Astra International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nippon Indosari 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.| Nippon Indosari vs. Mayora Indah Tbk | Nippon Indosari vs. Ultra Jaya Milk | Nippon Indosari vs. Mitra Adiperkasa Tbk | Nippon Indosari vs. FKS Food Sejahtera |
| Astra International vs. Pembangunan Graha Lestari | Astra International vs. Pembangunan Jaya Ancol | Astra International vs. Hotel Sahid Jaya | Astra International vs. Mitrabara Adiperdana PT |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |