Correlation Between PT Astra and Azure Power
Can any of the company-specific risk be diversified away by investing in both PT Astra and Azure Power 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 Azure Power 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 Azure Power Global, you can compare the effects of market volatilities on PT Astra and Azure Power 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 Azure Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Astra and Azure Power.
Diversification Opportunities for PT Astra and Azure Power
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PTAIF and Azure is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and Azure Power Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Azure Power Global 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 Azure Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Azure Power Global has no effect on the direction of PT Astra i.e., PT Astra and Azure Power go up and down completely randomly.
Pair Corralation between PT Astra and Azure Power
Assuming the 90 days horizon PT Astra International is expected to generate 0.3 times more return on investment than Azure Power. However, PT Astra International is 3.38 times less risky than Azure Power. It trades about 0.0 of its potential returns per unit of risk. Azure Power Global is currently generating about -0.21 per unit of risk. If you would invest 44.00 in PT Astra International on September 7, 2024 and sell it today you would lose (7.00) from holding PT Astra International or give up 15.91% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 19.72% |
Values | Daily Returns |
PT Astra International vs. Azure Power Global
Performance |
Timeline |
PT Astra International |
Azure Power Global |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
PT Astra and Azure Power Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with PT Astra and Azure Power
The main advantage of trading using opposite PT Astra and Azure Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Astra position performs unexpectedly, Azure Power 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 Azure Power will offset losses from the drop in Azure Power's long position.PT Astra vs. Allison Transmission Holdings | PT Astra vs. Luminar Technologies | PT Astra vs. Quantumscape Corp | PT Astra vs. Lear Corporation |
Azure Power vs. Altus Power | Azure Power vs. Ormat Technologies | Azure Power vs. Enlight Renewable Energy | Azure Power vs. Fluence Energy |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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