Correlation Between Asuransi Bintang and Astra International
Can any of the company-specific risk be diversified away by investing in both Asuransi Bintang and Astra International 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 Asuransi Bintang and Astra International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asuransi Bintang Tbk and Astra International Tbk, you can compare the effects of market volatilities on Asuransi Bintang and Astra International 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 Asuransi Bintang with a short position of Astra International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asuransi Bintang and Astra International.
Diversification Opportunities for Asuransi Bintang and Astra International
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Asuransi and Astra is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Asuransi Bintang Tbk and Astra International Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astra International Tbk and Asuransi Bintang 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 Asuransi Bintang Tbk are associated (or correlated) with Astra International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astra International Tbk has no effect on the direction of Asuransi Bintang i.e., Asuransi Bintang and Astra International go up and down completely randomly.
Pair Corralation between Asuransi Bintang and Astra International
Assuming the 90 days trading horizon Asuransi Bintang Tbk is expected to generate 2.59 times more return on investment than Astra International. However, Asuransi Bintang is 2.59 times more volatile than Astra International Tbk. It trades about 0.16 of its potential returns per unit of risk. Astra International Tbk is currently generating about 0.1 per unit of risk. If you would invest 80,500 in Asuransi Bintang Tbk on February 7, 2024 and sell it today you would earn a total of 8,500 from holding Asuransi Bintang Tbk or generate 10.56% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 93.33% |
Values | Daily Returns |
Asuransi Bintang Tbk vs. Astra International Tbk
Performance |
Timeline |
Asuransi Bintang Tbk |
Astra International Tbk |
Asuransi Bintang and Astra International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Asuransi Bintang and Astra International
The main advantage of trading using opposite Asuransi Bintang and Astra International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asuransi Bintang position performs unexpectedly, Astra International 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 Astra International will offset losses from the drop in Astra International's long position.Asuransi Bintang vs. Asuransi Dayin Mitra | Asuransi Bintang vs. Asuransi Harta Aman | Asuransi Bintang vs. Asuransi Ramayana Tbk | Asuransi Bintang vs. Asuransi Jasa Tania |
Astra International vs. Intraco Penta Tbk | Astra International vs. Perdana Bangun Pusaka | Astra International vs. Tanah Laut Tbk |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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