Correlation Between Adi Sarana and Exploitasi Energi
Can any of the company-specific risk be diversified away by investing in both Adi Sarana and Exploitasi Energi 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 Adi Sarana and Exploitasi Energi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adi Sarana Armada and Exploitasi Energi Indonesia, you can compare the effects of market volatilities on Adi Sarana and Exploitasi Energi 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 Adi Sarana with a short position of Exploitasi Energi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adi Sarana and Exploitasi Energi.
Diversification Opportunities for Adi Sarana and Exploitasi Energi
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Adi and Exploitasi is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Adi Sarana Armada and Exploitasi Energi Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exploitasi Energi and Adi Sarana 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 Adi Sarana Armada are associated (or correlated) with Exploitasi Energi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exploitasi Energi has no effect on the direction of Adi Sarana i.e., Adi Sarana and Exploitasi Energi go up and down completely randomly.
Pair Corralation between Adi Sarana and Exploitasi Energi
Assuming the 90 days trading horizon Adi Sarana Armada is expected to under-perform the Exploitasi Energi. But the stock apears to be less risky and, when comparing its historical volatility, Adi Sarana Armada is 7.41 times less risky than Exploitasi Energi. The stock trades about -0.07 of its potential returns per unit of risk. The Exploitasi Energi Indonesia is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 700.00 in Exploitasi Energi Indonesia on September 14, 2024 and sell it today you would earn a total of 600.00 from holding Exploitasi Energi Indonesia or generate 85.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Adi Sarana Armada vs. Exploitasi Energi Indonesia
Performance |
| Timeline |
| Adi Sarana Armada |
| Exploitasi Energi |
Adi Sarana and Exploitasi Energi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adi Sarana and Exploitasi Energi
The main advantage of trading using opposite Adi Sarana and Exploitasi Energi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adi Sarana position performs unexpectedly, Exploitasi Energi 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 Exploitasi Energi will offset losses from the drop in Exploitasi Energi's long position.| Adi Sarana vs. PT Indonesia Kendaraan | Adi Sarana vs. Surya Toto Indonesia | Adi Sarana vs. Mitra Pinasthika Mustika | Adi Sarana vs. Integra Indocabinet Tbk |
| Exploitasi Energi vs. Harum Energy Tbk | Exploitasi Energi vs. Delta Dunia Makmur | Exploitasi Energi vs. Adi Sarana Armada | Exploitasi Energi vs. Elang Mahkota Teknologi |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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