Correlation Between Alam Sutera and Wahana Pronatural

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Can any of the company-specific risk be diversified away by investing in both Alam Sutera and Wahana Pronatural 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 Alam Sutera and Wahana Pronatural into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alam Sutera Realty and Wahana Pronatural, you can compare the effects of market volatilities on Alam Sutera and Wahana Pronatural 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 Alam Sutera with a short position of Wahana Pronatural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alam Sutera and Wahana Pronatural.

Diversification Opportunities for Alam Sutera and Wahana Pronatural

AlamWahanaDiversified AwayAlamWahanaDiversified Away100%
-0.67
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Alam and Wahana is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Alam Sutera Realty and Wahana Pronatural in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wahana Pronatural and Alam Sutera 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 Alam Sutera Realty are associated (or correlated) with Wahana Pronatural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wahana Pronatural has no effect on the direction of Alam Sutera i.e., Alam Sutera and Wahana Pronatural go up and down completely randomly.

Pair Corralation between Alam Sutera and Wahana Pronatural

Assuming the 90 days trading horizon Alam Sutera Realty is expected to under-perform the Wahana Pronatural. But the stock apears to be less risky and, when comparing its historical volatility, Alam Sutera Realty is 1.66 times less risky than Wahana Pronatural. The stock trades about 0.0 of its potential returns per unit of risk. The Wahana Pronatural is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  18,200  in Wahana Pronatural on November 24, 2024 and sell it today you would lose (5,000) from holding Wahana Pronatural or give up 27.47% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy99.79%
ValuesDaily Returns

Alam Sutera Realty  vs.  Wahana Pronatural

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -20020406080
JavaScript chart by amCharts 3.21.15ASRI WAPO
       Timeline  
Alam Sutera Realty 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Alam Sutera Realty has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in March 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb130135140145150155160165
Wahana Pronatural 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Wahana Pronatural are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Wahana Pronatural disclosed solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb100120140160180

Alam Sutera and Wahana Pronatural Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-4.41-3.3-2.19-1.090.00.931.882.843.84.76 0.010.020.030.040.050.06
JavaScript chart by amCharts 3.21.15ASRI WAPO
       Returns  

Pair Trading with Alam Sutera and Wahana Pronatural

The main advantage of trading using opposite Alam Sutera and Wahana Pronatural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alam Sutera position performs unexpectedly, Wahana Pronatural 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 Wahana Pronatural will offset losses from the drop in Wahana Pronatural's long position.
The idea behind Alam Sutera Realty and Wahana Pronatural pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..

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