Correlation Between Eq Energy and PT Astra

Can any of the company-specific risk be diversified away by investing in both Eq Energy and PT Astra 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 Eq Energy and PT Astra into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Eq Energy Drink and PT Astra International, you can compare the effects of market volatilities on Eq Energy and PT Astra 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 Eq Energy with a short position of PT Astra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eq Energy and PT Astra.

Diversification Opportunities for Eq Energy and PT Astra

0.43

Correlation Coefficient

Eq Energy  PT Astra

Very weak diversification

The 3 months correlation between EQLB and ASII is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Eq Energy Drink and PT Astra International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Astra International and Eq Energy 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 Eq Energy Drink are associated (or correlated) with PT Astra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Astra International has no effect on the direction of Eq Energy i.e., Eq Energy and PT Astra go up and down completely randomly.

Pair Corralation between Eq Energy and PT Astra

Given the investment horizon of 90 days Eq Energy Drink is expected to generate 1.08 times more return on investment than PT Astra. However, Eq Energy is 1.08 times more volatile than PT Astra International. It trades about 0.15 of its potential returns per unit of risk. PT Astra International is currently generating about 0.1 per unit of risk. If you would invest  0.07  in Eq Energy Drink on May 15, 2025 and sell it today you would earn a total of  0.03  from holding Eq Energy Drink or generate 42.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.39%
Values	Daily Returns

Eq Energy Drink  vs.  PT Astra International

Eq Energy Drink

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Eq Energy Drink are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat abnormal essential indicators, Eq Energy sustained solid returns over the last few months and may actually be approaching a breakup point.

PT Astra International

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in PT Astra International are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite fairly abnormal forward indicators, PT Astra demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Eq Energy and PT Astra

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

The idea behind Eq Energy Drink and PT Astra International 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.