Correlation Between Alumindo Light and Citra Borneo
Can any of the company-specific risk be diversified away by investing in both Alumindo Light and Citra Borneo 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 Alumindo Light and Citra Borneo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alumindo Light Metal and Citra Borneo Utama, you can compare the effects of market volatilities on Alumindo Light and Citra Borneo 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 Alumindo Light with a short position of Citra Borneo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alumindo Light and Citra Borneo.
Diversification Opportunities for Alumindo Light and Citra Borneo
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Alumindo and Citra is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Alumindo Light Metal and Citra Borneo Utama in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citra Borneo Utama and Alumindo Light 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 Alumindo Light Metal are associated (or correlated) with Citra Borneo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citra Borneo Utama has no effect on the direction of Alumindo Light i.e., Alumindo Light and Citra Borneo go up and down completely randomly.
Pair Corralation between Alumindo Light and Citra Borneo
If you would invest 94,000 in Citra Borneo Utama on October 26, 2024 and sell it today you would earn a total of 15,500 from holding Citra Borneo Utama or generate 16.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alumindo Light Metal vs. Citra Borneo Utama
Performance |
| Timeline |
| Alumindo Light Metal |
| Citra Borneo Utama |
Alumindo Light and Citra Borneo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alumindo Light and Citra Borneo
The main advantage of trading using opposite Alumindo Light and Citra Borneo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alumindo Light position performs unexpectedly, Citra Borneo 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 Citra Borneo will offset losses from the drop in Citra Borneo's long position.| Alumindo Light vs. Asiaplast Industries Tbk | Alumindo Light vs. Argha Karya Prima | Alumindo Light vs. Indal Aluminium Industry | Alumindo Light vs. Alakasa Industrindo Tbk |
| Citra Borneo vs. Alumindo Light Metal | Citra Borneo vs. Ashmore Asset Management | Citra Borneo vs. Equity Development Investment | Citra Borneo vs. HK Metals Utama |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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