Correlation Between PT Astra and TPX Old

Can any of the company-specific risk be diversified away by investing in both PT Astra and TPX Old 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 TPX Old 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 TPX Old, you can compare the effects of market volatilities on PT Astra and TPX Old 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 TPX Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Astra and TPX Old.

Diversification Opportunities for PT Astra and TPX Old

0.83

Correlation Coefficient

PT Astra  TPX Old

Very poor diversification

The 3 months correlation between PTAIF and TPX is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding PT Astra International and TPX Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TPX Old 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 TPX Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TPX Old has no effect on the direction of PT Astra i.e., PT Astra and TPX Old go up and down completely randomly.

Pair Corralation between PT Astra and TPX Old

If you would invest  28.00  in PT Astra International on May 2, 2025 and sell it today you would earn a total of  3.00  from holding PT Astra International or generate 10.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	1.61%
Values	Daily Returns

PT Astra International  vs.  TPX Old

PT Astra International

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in PT Astra International are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward indicators, PT Astra may actually be approaching a critical reversion point that can send shares even higher in August 2025.

TPX Old

Risk-Adjusted Performance

Very Weak

Over the last 90 days TPX Old has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, TPX Old is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with PT Astra and TPX Old

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

The idea behind PT Astra International and TPX Old 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.

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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.