Correlation Between Agro Yasa and Royalindo Investa
Can any of the company-specific risk be diversified away by investing in both Agro Yasa and Royalindo Investa 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 Agro Yasa and Royalindo Investa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Agro Yasa Lestari and Royalindo Investa Wijaya, you can compare the effects of market volatilities on Agro Yasa and Royalindo Investa 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 Agro Yasa with a short position of Royalindo Investa. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agro Yasa and Royalindo Investa.
Diversification Opportunities for Agro Yasa and Royalindo Investa
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Agro and Royalindo is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Agro Yasa Lestari and Royalindo Investa Wijaya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Royalindo Investa Wijaya and Agro Yasa 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 Agro Yasa Lestari are associated (or correlated) with Royalindo Investa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Royalindo Investa Wijaya has no effect on the direction of Agro Yasa i.e., Agro Yasa and Royalindo Investa go up and down completely randomly.
Pair Corralation between Agro Yasa and Royalindo Investa
Assuming the 90 days trading horizon Agro Yasa Lestari is expected to generate 2.24 times more return on investment than Royalindo Investa. However, Agro Yasa is 2.24 times more volatile than Royalindo Investa Wijaya. It trades about 0.08 of its potential returns per unit of risk. Royalindo Investa Wijaya is currently generating about 0.09 per unit of risk. If you would invest 7,500 in Agro Yasa Lestari on October 24, 2024 and sell it today you would earn a total of 2,500 from holding Agro Yasa Lestari or generate 33.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.78% |
| Values | Daily Returns |
Agro Yasa Lestari vs. Royalindo Investa Wijaya
Performance |
| Timeline |
| Agro Yasa Lestari |
| Royalindo Investa Wijaya |
Agro Yasa and Royalindo Investa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agro Yasa and Royalindo Investa
The main advantage of trading using opposite Agro Yasa and Royalindo Investa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agro Yasa position performs unexpectedly, Royalindo Investa 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 Royalindo Investa will offset losses from the drop in Royalindo Investa's long position.| Agro Yasa vs. Sinergi Inti Plastindo | Agro Yasa vs. Bank Amar Indonesia | Agro Yasa vs. Andalan Sakti Primaindo | Agro Yasa vs. Era Mandiri Cemerlang |
| Royalindo Investa vs. Andalan Sakti Primaindo | Royalindo Investa vs. Bumi Benowo Sukses | Royalindo Investa vs. Bima Sakti Pertiwi | Royalindo Investa vs. Agro Yasa Lestari |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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