Correlation Between Alam Sutera and Aksara Global

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

By analyzing existing cross correlation between Alam Sutera Realty and Aksara Global Development, you can compare the effects of market volatilities on Alam Sutera and Aksara Global 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 Alam Sutera with a short position of Aksara Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alam Sutera and Aksara Global.

Diversification Opportunities for Alam Sutera and Aksara Global

0.0

Correlation Coefficient

Alam Sutera  Aksara Global

Pay attention - limited upside

The 3 months correlation between Alam and Aksara is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Alam Sutera Realty and Aksara Global Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aksara Global Development and Alam Sutera 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 Alam Sutera Realty are associated (or correlated) with Aksara Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aksara Global Development has no effect on the direction of Alam Sutera i.e., Alam Sutera and Aksara Global go up and down completely randomly.

Pair Corralation between Alam Sutera and Aksara Global

Assuming the 90 days trading horizon Alam Sutera Realty is expected to generate 1.87 times more return on investment than Aksara Global. However, Alam Sutera is 1.87 times more volatile than Aksara Global Development. It trades about 0.01 of its potential returns per unit of risk. Aksara Global Development is currently generating about -0.16 per unit of risk. If you would invest  16,500  in Alam Sutera Realty on September 13, 2024 and sell it today you would lose (300.00) from holding Alam Sutera Realty or give up 1.82% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	99.79%
Values	Daily Returns

Alam Sutera Realty  vs.  Aksara Global Development

Alam Sutera Realty

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Alam Sutera Realty has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Aksara Global Development

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Aksara Global Development has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Aksara Global 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 Alam Sutera and Aksara Global

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

The idea behind Alam Sutera Realty and Aksara Global Development 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 Transaction History module to view history of all your transactions and understand their impact on performance.