Correlation Between PT Astra and Virtual Crypto

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

Diversification Opportunities for PT Astra and Virtual Crypto

-0.55

Correlation Coefficient

PT Astra  Virtual Crypto

Excellent diversification

The 3 months correlation between PTAIF and Virtual is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and Virtual Crypto Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtual Crypto Techn 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 Virtual Crypto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtual Crypto Techn has no effect on the direction of PT Astra i.e., PT Astra and Virtual Crypto go up and down completely randomly.

Pair Corralation between PT Astra and Virtual Crypto

Assuming the 90 days horizon PT Astra International is expected to generate 0.06 times more return on investment than Virtual Crypto. However, PT Astra International is 15.69 times less risky than Virtual Crypto. It trades about -0.22 of its potential returns per unit of risk. Virtual Crypto Technologies is currently generating about -0.23 per unit of risk. If you would invest  33.00  in PT Astra International on January 29, 2024 and sell it today you would lose (1.00) from holding PT Astra International or give up 3.03% of portfolio value over 90 days.

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

PT Astra International  vs.  Virtual Crypto Technologies

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 latest weak performance, the Stock's forward indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Virtual Crypto Techn

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Virtual Crypto Technologies are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain forward indicators, Virtual Crypto showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PT Astra and Virtual Crypto

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

The idea behind PT Astra International and Virtual Crypto Technologies 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.