Correlation Between Obayashi and Astra International
Can any of the company-specific risk be diversified away by investing in both Obayashi 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 Obayashi and Astra International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Obayashi and Astra International Tbk, you can compare the effects of market volatilities on Obayashi 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 Obayashi with a short position of Astra International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Obayashi and Astra International.
Diversification Opportunities for Obayashi and Astra International
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Obayashi and Astra is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Obayashi 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 Obayashi 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 Obayashi 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 Obayashi i.e., Obayashi and Astra International go up and down completely randomly.
Pair Corralation between Obayashi and Astra International
Assuming the 90 days horizon Obayashi is expected to generate 1.11 times more return on investment than Astra International. However, Obayashi is 1.11 times more volatile than Astra International Tbk. It trades about 0.12 of its potential returns per unit of risk. Astra International Tbk is currently generating about -0.06 per unit of risk. If you would invest 1,108 in Obayashi on September 26, 2024 and sell it today you would earn a total of 212.00 from holding Obayashi or generate 19.13% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.44% |
Values | Daily Returns |
Obayashi vs. Astra International Tbk
Performance |
Timeline |
Obayashi |
Astra International Tbk |
Obayashi and Astra International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Obayashi and Astra International
The main advantage of trading using opposite Obayashi and Astra International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Obayashi 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.Obayashi vs. Watsco Inc | Obayashi vs. Fastenal Company | Obayashi vs. SiteOne Landscape Supply | Obayashi vs. Ferguson Plc |
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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 CEOs Directory module to screen CEOs from public companies around the world.
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