Correlation Between Akasha Wira and Arwana Citramulia
Can any of the company-specific risk be diversified away by investing in both Akasha Wira and Arwana Citramulia 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 Akasha Wira and Arwana Citramulia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Akasha Wira International and Arwana Citramulia Tbk, you can compare the effects of market volatilities on Akasha Wira and Arwana Citramulia 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 Akasha Wira with a short position of Arwana Citramulia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Akasha Wira and Arwana Citramulia.
Diversification Opportunities for Akasha Wira and Arwana Citramulia
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Akasha and Arwana is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Akasha Wira International and Arwana Citramulia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arwana Citramulia Tbk and Akasha Wira 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 Akasha Wira International are associated (or correlated) with Arwana Citramulia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arwana Citramulia Tbk has no effect on the direction of Akasha Wira i.e., Akasha Wira and Arwana Citramulia go up and down completely randomly.
Pair Corralation between Akasha Wira and Arwana Citramulia
Assuming the 90 days trading horizon Akasha Wira International is expected to generate 2.17 times more return on investment than Arwana Citramulia. However, Akasha Wira is 2.17 times more volatile than Arwana Citramulia Tbk. It trades about 0.09 of its potential returns per unit of risk. Arwana Citramulia Tbk is currently generating about -0.34 per unit of risk. If you would invest 960,000 in Akasha Wira International on February 5, 2024 and sell it today you would earn a total of 35,000 from holding Akasha Wira International or generate 3.65% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Akasha Wira International vs. Arwana Citramulia Tbk
Performance |
Timeline |
Akasha Wira International |
Arwana Citramulia Tbk |
Akasha Wira and Arwana Citramulia Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Akasha Wira and Arwana Citramulia
The main advantage of trading using opposite Akasha Wira and Arwana Citramulia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Akasha Wira position performs unexpectedly, Arwana Citramulia 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 Arwana Citramulia will offset losses from the drop in Arwana Citramulia's long position.Akasha Wira vs. Fast Food Indonesia | Akasha Wira vs. Enseval Putra Megatrading | Akasha Wira vs. Matahari Putra Prima | Akasha Wira vs. Hexindo Adiperkasa Tbk |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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