Correlation Between Spire Global and Asiaplast Industries

Can any of the company-specific risk be diversified away by investing in both Spire Global and Asiaplast Industries 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 Spire Global and Asiaplast Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Spire Global and Asiaplast Industries Tbk, you can compare the effects of market volatilities on Spire Global and Asiaplast Industries 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 Spire Global with a short position of Asiaplast Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spire Global and Asiaplast Industries.

Diversification Opportunities for Spire Global and Asiaplast Industries

0.66

Correlation Coefficient

Spire Global  Asiaplast Industries

Poor diversification

The 3 months correlation between Spire and Asiaplast is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Spire Global and Asiaplast Industries Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asiaplast Industries Tbk and Spire Global 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 Spire Global are associated (or correlated) with Asiaplast Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asiaplast Industries Tbk has no effect on the direction of Spire Global i.e., Spire Global and Asiaplast Industries go up and down completely randomly.

Pair Corralation between Spire Global and Asiaplast Industries

Given the investment horizon of 90 days Spire Global is expected to under-perform the Asiaplast Industries. In addition to that, Spire Global is 2.69 times more volatile than Asiaplast Industries Tbk. It trades about -0.05 of its total potential returns per unit of risk. Asiaplast Industries Tbk is currently generating about 0.03 per unit of volatility. If you would invest  54,500  in Asiaplast Industries Tbk on December 30, 2024 and sell it today you would earn a total of  1,500  from holding Asiaplast Industries Tbk or generate 2.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	96.77%
Values	Daily Returns

Spire Global  vs.  Asiaplast Industries Tbk

Spire Global

Risk-Adjusted Performance

Very Weak

Over the last 90 days Spire Global has generated negative risk-adjusted returns adding no value to investors with long positions. Even with unfluctuating performance in the last few months, the Stock's forward indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Asiaplast Industries Tbk

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Asiaplast Industries Tbk are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Asiaplast Industries is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Spire Global and Asiaplast Industries

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

The idea behind Spire Global and Asiaplast Industries Tbk 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.

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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.