Correlation Between Unilever Indonesia and Astra International
Can any of the company-specific risk be diversified away by investing in both Unilever Indonesia 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 Unilever Indonesia and Astra International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unilever Indonesia Tbk and Astra International Tbk, you can compare the effects of market volatilities on Unilever Indonesia 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 Unilever Indonesia with a short position of Astra International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unilever Indonesia and Astra International.
Diversification Opportunities for Unilever Indonesia and Astra International
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Unilever and Astra is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Unilever Indonesia Tbk 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 Unilever Indonesia 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 Unilever Indonesia Tbk 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 Unilever Indonesia i.e., Unilever Indonesia and Astra International go up and down completely randomly.
Pair Corralation between Unilever Indonesia and Astra International
Assuming the 90 days trading horizon Unilever Indonesia Tbk is expected to under-perform the Astra International. In addition to that, Unilever Indonesia is 1.44 times more volatile than Astra International Tbk. It trades about -0.08 of its total potential returns per unit of risk. Astra International Tbk is currently generating about 0.01 per unit of volatility. If you would invest 464,165 in Astra International Tbk on November 2, 2024 and sell it today you would earn a total of 14,835 from holding Astra International Tbk or generate 3.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Unilever Indonesia Tbk vs. Astra International Tbk
Performance |
| Timeline |
| Unilever Indonesia Tbk |
| Astra International Tbk |
Unilever Indonesia and Astra International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unilever Indonesia and Astra International
The main advantage of trading using opposite Unilever Indonesia and Astra International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unilever Indonesia 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.| Unilever Indonesia vs. PT Indofood Sukses | Unilever Indonesia vs. Astra International Tbk | Unilever Indonesia vs. Telkom Indonesia Tbk | Unilever Indonesia vs. Bank Central Asia |
| 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |