Correlation Between Japan Asia and PT Astra
Can any of the company-specific risk be diversified away by investing in both Japan Asia and PT Astra 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 Japan Asia and PT Astra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Japan Asia Investment and PT Astra International, you can compare the effects of market volatilities on Japan Asia and PT Astra 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 Japan Asia with a short position of PT Astra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Japan Asia and PT Astra.
Diversification Opportunities for Japan Asia and PT Astra
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Japan and ASJA is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Japan Asia Investment and PT Astra International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Astra International and Japan Asia 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 Japan Asia Investment are associated (or correlated) with PT Astra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Astra International has no effect on the direction of Japan Asia i.e., Japan Asia and PT Astra go up and down completely randomly.
Pair Corralation between Japan Asia and PT Astra
Assuming the 90 days horizon Japan Asia Investment is expected to generate 0.28 times more return on investment than PT Astra. However, Japan Asia Investment is 3.55 times less risky than PT Astra. It trades about 0.01 of its potential returns per unit of risk. PT Astra International is currently generating about -0.02 per unit of risk. If you would invest 128.00 in Japan Asia Investment on October 25, 2024 and sell it today you would earn a total of 0.00 from holding Japan Asia Investment or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Japan Asia Investment vs. PT Astra International
Performance |
Timeline |
Japan Asia Investment |
PT Astra International |
Japan Asia and PT Astra Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Japan Asia and PT Astra
The main advantage of trading using opposite Japan Asia and PT Astra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Japan Asia position performs unexpectedly, PT Astra 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 PT Astra will offset losses from the drop in PT Astra's long position.Japan Asia vs. CompuGroup Medical SE | Japan Asia vs. Scientific Games | Japan Asia vs. Diamyd Medical AB | Japan Asia vs. PENN NATL GAMING |
PT Astra vs. Zoom Video Communications | PT Astra vs. Harmony Gold Mining | PT Astra vs. Charter Communications | PT Astra vs. MAVEN WIRELESS SWEDEN |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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