Correlation Between Wir Asia and Autopedia Sukses

Can any of the company-specific risk be diversified away by investing in both Wir Asia and Autopedia Sukses 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 Wir Asia and Autopedia Sukses into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Wir Asia Tbk and Autopedia Sukses Lestari, you can compare the effects of market volatilities on Wir Asia and Autopedia Sukses 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 Wir Asia with a short position of Autopedia Sukses. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wir Asia and Autopedia Sukses.

Diversification Opportunities for Wir Asia and Autopedia Sukses

0.25

Correlation Coefficient

Wir Asia  Autopedia Sukses

Modest diversification

The 3 months correlation between Wir and Autopedia is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Wir Asia Tbk and Autopedia Sukses Lestari in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autopedia Sukses Lestari and Wir 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 Wir Asia Tbk are associated (or correlated) with Autopedia Sukses. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autopedia Sukses Lestari has no effect on the direction of Wir Asia i.e., Wir Asia and Autopedia Sukses go up and down completely randomly.

Pair Corralation between Wir Asia and Autopedia Sukses

Assuming the 90 days trading horizon Wir Asia Tbk is expected to generate 3.25 times more return on investment than Autopedia Sukses. However, Wir Asia is 3.25 times more volatile than Autopedia Sukses Lestari. It trades about 0.03 of its potential returns per unit of risk. Autopedia Sukses Lestari is currently generating about -0.09 per unit of risk. If you would invest  8,400  in Wir Asia Tbk on December 30, 2024 and sell it today you would earn a total of  100.00  from holding Wir Asia Tbk or generate 1.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Wir Asia Tbk  vs.  Autopedia Sukses Lestari

Wir Asia Tbk

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Wir Asia Tbk are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Wir Asia may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Autopedia Sukses Lestari

Risk-Adjusted Performance

Very Weak

Over the last 90 days Autopedia Sukses Lestari has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Wir Asia and Autopedia Sukses

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

The idea behind Wir Asia Tbk and Autopedia Sukses Lestari 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.