Correlation Between PT Astra and Bryn Resources

Can any of the company-specific risk be diversified away by investing in both PT Astra and Bryn Resources 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 PT Astra and Bryn Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PT Astra International and Bryn Resources, you can compare the effects of market volatilities on PT Astra and Bryn Resources 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 PT Astra with a short position of Bryn Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Astra and Bryn Resources.

Diversification Opportunities for PT Astra and Bryn Resources

-0.65

Correlation Coefficient

PT Astra  Bryn Resources

Excellent diversification

The 3 months correlation between PTAIF and Bryn is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and Bryn Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bryn Resources and PT Astra 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 PT Astra International are associated (or correlated) with Bryn Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bryn Resources has no effect on the direction of PT Astra i.e., PT Astra and Bryn Resources go up and down completely randomly.

Pair Corralation between PT Astra and Bryn Resources

If you would invest  37.00  in PT Astra International on September 17, 2024 and sell it today you would earn a total of  0.00  from holding PT Astra International or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	95.24%
Values	Daily Returns

PT Astra International  vs.  Bryn Resources

PT Astra International

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in PT Astra International are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly unfluctuating forward indicators, PT Astra reported solid returns over the last few months and may actually be approaching a breakup point.

Bryn Resources

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Bryn Resources are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating basic indicators, Bryn Resources displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PT Astra and Bryn Resources

The main advantage of trading using opposite PT Astra and Bryn Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Astra position performs unexpectedly, Bryn Resources 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 Bryn Resources will offset losses from the drop in Bryn Resources' long position.

The idea behind PT Astra International and Bryn Resources 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.