Correlation Between PT Astra and Project Energy

Can any of the company-specific risk be diversified away by investing in both PT Astra and Project Energy 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 Project Energy 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 Project Energy Reimagined, you can compare the effects of market volatilities on PT Astra and Project Energy 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 Project Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Astra and Project Energy.

Diversification Opportunities for PT Astra and Project Energy

0.74

Correlation Coefficient

PT Astra  Project Energy

Poor diversification

The 3 months correlation between PTAIF and Project is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and Project Energy Reimagined in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Project Energy Reimagined 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 Project Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Project Energy Reimagined has no effect on the direction of PT Astra i.e., PT Astra and Project Energy go up and down completely randomly.

Pair Corralation between PT Astra and Project Energy

If you would invest (100.00) in Project Energy Reimagined on October 9, 2024 and sell it today you would earn a total of  100.00  from holding Project Energy Reimagined or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	0.0%
Values	Daily Returns

PT Astra International  vs.  Project Energy Reimagined

PT Astra International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PT Astra International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's forward indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Project Energy Reimagined

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Project Energy Reimagined has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical and fundamental indicators, Project Energy is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with PT Astra and Project Energy

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

The idea behind PT Astra International and Project Energy Reimagined 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.