Correlation Between PT Cilacap and PT Kusuma
Can any of the company-specific risk be diversified away by investing in both PT Cilacap and PT Kusuma 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 Cilacap and PT Kusuma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Cilacap Samudera and PT Kusuma Kemindo, you can compare the effects of market volatilities on PT Cilacap and PT Kusuma 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 Cilacap with a short position of PT Kusuma. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Cilacap and PT Kusuma.
Diversification Opportunities for PT Cilacap and PT Kusuma
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ASHA and KKES is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding PT Cilacap Samudera and PT Kusuma Kemindo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Kusuma Kemindo and PT Cilacap 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 Cilacap Samudera are associated (or correlated) with PT Kusuma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Kusuma Kemindo has no effect on the direction of PT Cilacap i.e., PT Cilacap and PT Kusuma go up and down completely randomly.
Pair Corralation between PT Cilacap and PT Kusuma
Assuming the 90 days trading horizon PT Cilacap Samudera is expected to generate 3.23 times more return on investment than PT Kusuma. However, PT Cilacap is 3.23 times more volatile than PT Kusuma Kemindo. It trades about -0.15 of its potential returns per unit of risk. PT Kusuma Kemindo is currently generating about -0.53 per unit of risk. If you would invest 1,500 in PT Cilacap Samudera on August 30, 2024 and sell it today you would lose (300.00) from holding PT Cilacap Samudera or give up 20.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Cilacap Samudera vs. PT Kusuma Kemindo
Performance |
| Timeline |
| PT Cilacap Samudera |
| PT Kusuma Kemindo |
PT Cilacap and PT Kusuma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Cilacap and PT Kusuma
The main advantage of trading using opposite PT Cilacap and PT Kusuma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Cilacap position performs unexpectedly, PT Kusuma 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 PT Kusuma will offset losses from the drop in PT Kusuma's long position.| PT Cilacap vs. Bank Central Asia | PT Cilacap vs. Bank Rakyat Indonesia | PT Cilacap vs. Bayan Resources Tbk | PT Cilacap vs. Bank Mandiri Persero |
| PT Kusuma vs. PT Dewi Shri | PT Kusuma vs. PT Cilacap Samudera | PT Kusuma vs. PT Arkora Hydro | PT Kusuma vs. Habco Trans Maritima |
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 Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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