Correlation Between PT Jasa and COFACE SA
Can any of the company-specific risk be diversified away by investing in both PT Jasa and COFACE SA 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 Jasa and COFACE SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Jasa Marga and COFACE SA, you can compare the effects of market volatilities on PT Jasa and COFACE SA 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 Jasa with a short position of COFACE SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Jasa and COFACE SA.
Diversification Opportunities for PT Jasa and COFACE SA
Poor diversification
The 3 months correlation between 0JM and COFACE is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding PT Jasa Marga and COFACE SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COFACE SA and PT Jasa 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 Jasa Marga are associated (or correlated) with COFACE SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COFACE SA has no effect on the direction of PT Jasa i.e., PT Jasa and COFACE SA go up and down completely randomly.
Pair Corralation between PT Jasa and COFACE SA
Assuming the 90 days horizon PT Jasa Marga is expected to under-perform the COFACE SA. In addition to that, PT Jasa is 1.87 times more volatile than COFACE SA. It trades about -0.03 of its total potential returns per unit of risk. COFACE SA is currently generating about 0.02 per unit of volatility. If you would invest 1,319 in COFACE SA on September 24, 2024 and sell it today you would earn a total of 55.00 from holding COFACE SA or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Jasa Marga vs. COFACE SA
Performance |
| Timeline |
| PT Jasa Marga |
| COFACE SA |
PT Jasa and COFACE SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Jasa and COFACE SA
The main advantage of trading using opposite PT Jasa and COFACE SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Jasa position performs unexpectedly, COFACE SA 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 COFACE SA will offset losses from the drop in COFACE SA's long position.| PT Jasa vs. GLG LIFE TECH | PT Jasa vs. PKSHA TECHNOLOGY INC | PT Jasa vs. Virtus Investment Partners | PT Jasa vs. REINET INVESTMENTS SCA |
| COFACE SA vs. Sterling Construction | COFACE SA vs. SENECA FOODS A | COFACE SA vs. National Beverage Corp | COFACE SA vs. Dairy Farm International |
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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