Correlation Between Trias Sentosa and Asiaplast Industries
Can any of the company-specific risk be diversified away by investing in both Trias Sentosa and Asiaplast Industries 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 Trias Sentosa and Asiaplast Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trias Sentosa Tbk and Asiaplast Industries Tbk, you can compare the effects of market volatilities on Trias Sentosa and Asiaplast Industries 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 Trias Sentosa with a short position of Asiaplast Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trias Sentosa and Asiaplast Industries.
Diversification Opportunities for Trias Sentosa and Asiaplast Industries
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Trias and Asiaplast is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Trias Sentosa Tbk and Asiaplast Industries Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asiaplast Industries Tbk and Trias Sentosa 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 Trias Sentosa Tbk are associated (or correlated) with Asiaplast Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asiaplast Industries Tbk has no effect on the direction of Trias Sentosa i.e., Trias Sentosa and Asiaplast Industries go up and down completely randomly.
Pair Corralation between Trias Sentosa and Asiaplast Industries
Assuming the 90 days trading horizon Trias Sentosa Tbk is expected to generate 0.44 times more return on investment than Asiaplast Industries. However, Trias Sentosa Tbk is 2.29 times less risky than Asiaplast Industries. It trades about -0.01 of its potential returns per unit of risk. Asiaplast Industries Tbk is currently generating about -0.01 per unit of risk. If you would invest 49,600 in Trias Sentosa Tbk on September 26, 2024 and sell it today you would lose (600.00) from holding Trias Sentosa Tbk or give up 1.21% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.44% |
Values | Daily Returns |
Trias Sentosa Tbk vs. Asiaplast Industries Tbk
Performance |
Timeline |
Trias Sentosa Tbk |
Asiaplast Industries Tbk |
Trias Sentosa and Asiaplast Industries Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Trias Sentosa and Asiaplast Industries
The main advantage of trading using opposite Trias Sentosa and Asiaplast Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trias Sentosa position performs unexpectedly, Asiaplast Industries 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 Asiaplast Industries will offset losses from the drop in Asiaplast Industries' long position.Trias Sentosa vs. Intanwijaya Internasional Tbk | Trias Sentosa vs. Asiaplast Industries Tbk | Trias Sentosa vs. Lotte Chemical Titan |
Asiaplast Industries vs. Intanwijaya Internasional Tbk | Asiaplast Industries vs. Trias Sentosa Tbk | Asiaplast Industries vs. Lotte Chemical Titan |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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