Correlation Between Asuransi Bintang and Maming Enam
Can any of the company-specific risk be diversified away by investing in both Asuransi Bintang and Maming Enam 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 Asuransi Bintang and Maming Enam into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asuransi Bintang Tbk and Maming Enam Sembilan, you can compare the effects of market volatilities on Asuransi Bintang and Maming Enam 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 Asuransi Bintang with a short position of Maming Enam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asuransi Bintang and Maming Enam.
Diversification Opportunities for Asuransi Bintang and Maming Enam
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Asuransi and Maming is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Asuransi Bintang Tbk and Maming Enam Sembilan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maming Enam Sembilan and Asuransi Bintang 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 Asuransi Bintang Tbk are associated (or correlated) with Maming Enam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maming Enam Sembilan has no effect on the direction of Asuransi Bintang i.e., Asuransi Bintang and Maming Enam go up and down completely randomly.
Pair Corralation between Asuransi Bintang and Maming Enam
Assuming the 90 days trading horizon Asuransi Bintang Tbk is expected to under-perform the Maming Enam. But the stock apears to be less risky and, when comparing its historical volatility, Asuransi Bintang Tbk is 2.6 times less risky than Maming Enam. The stock trades about -0.4 of its potential returns per unit of risk. The Maming Enam Sembilan is currently generating about -0.13 of returns per unit of risk over similar time horizon. If you would invest 23,000 in Maming Enam Sembilan on November 4, 2024 and sell it today you would lose (2,800) from holding Maming Enam Sembilan or give up 12.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asuransi Bintang Tbk vs. Maming Enam Sembilan
Performance |
| Timeline |
| Asuransi Bintang Tbk |
| Maming Enam Sembilan |
Asuransi Bintang and Maming Enam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asuransi Bintang and Maming Enam
The main advantage of trading using opposite Asuransi Bintang and Maming Enam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asuransi Bintang position performs unexpectedly, Maming Enam 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 Maming Enam will offset losses from the drop in Maming Enam's long position.| Asuransi Bintang vs. Asuransi Dayin Mitra | Asuransi Bintang vs. Asuransi Harta Aman | Asuransi Bintang vs. Asuransi Ramayana Tbk | Asuransi Bintang vs. Asuransi Jasa Tania |
| Maming Enam vs. Asuransi Dayin Mitra | Maming Enam vs. Asuransi Harta Aman | Maming Enam vs. Asuransi Bintang Tbk | Maming Enam vs. Asuransi Ramayana Tbk |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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