Correlation Between Superior Plus and HEXINDO ADIPERKASA
Can any of the company-specific risk be diversified away by investing in both Superior Plus and HEXINDO ADIPERKASA 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 Superior Plus and HEXINDO ADIPERKASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Superior Plus Corp and HEXINDO ADIPERKASA, you can compare the effects of market volatilities on Superior Plus and HEXINDO ADIPERKASA 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 Superior Plus with a short position of HEXINDO ADIPERKASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and HEXINDO ADIPERKASA.
Diversification Opportunities for Superior Plus and HEXINDO ADIPERKASA
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Superior and HEXINDO is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and HEXINDO ADIPERKASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HEXINDO ADIPERKASA and Superior Plus 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 Superior Plus Corp are associated (or correlated) with HEXINDO ADIPERKASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HEXINDO ADIPERKASA has no effect on the direction of Superior Plus i.e., Superior Plus and HEXINDO ADIPERKASA go up and down completely randomly.
Pair Corralation between Superior Plus and HEXINDO ADIPERKASA
Assuming the 90 days horizon Superior Plus Corp is expected to generate 0.88 times more return on investment than HEXINDO ADIPERKASA. However, Superior Plus Corp is 1.13 times less risky than HEXINDO ADIPERKASA. It trades about -0.08 of its potential returns per unit of risk. HEXINDO ADIPERKASA is currently generating about -0.15 per unit of risk. If you would invest 488.00 in Superior Plus Corp on August 30, 2024 and sell it today you would lose (72.00) from holding Superior Plus Corp or give up 14.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Superior Plus Corp vs. HEXINDO ADIPERKASA
Performance |
| Timeline |
| Superior Plus Corp |
| HEXINDO ADIPERKASA |
Superior Plus and HEXINDO ADIPERKASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Superior Plus and HEXINDO ADIPERKASA
The main advantage of trading using opposite Superior Plus and HEXINDO ADIPERKASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, HEXINDO ADIPERKASA 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 HEXINDO ADIPERKASA will offset losses from the drop in HEXINDO ADIPERKASA's long position.| Superior Plus vs. HYDROFARM HLD GRP | Superior Plus vs. Titan Machinery | Superior Plus vs. GOODYEAR T RUBBER | Superior Plus vs. Sterling Construction |
| HEXINDO ADIPERKASA vs. Apple Inc | HEXINDO ADIPERKASA vs. Apple Inc | HEXINDO ADIPERKASA vs. Superior Plus Corp | HEXINDO ADIPERKASA vs. SIVERS SEMICONDUCTORS AB |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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