Correlation Between Bayu Buana and GoTo Gojek
Can any of the company-specific risk be diversified away by investing in both Bayu Buana and GoTo Gojek 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 Bayu Buana and GoTo Gojek into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bayu Buana Tbk and GoTo Gojek Tokopedia, you can compare the effects of market volatilities on Bayu Buana and GoTo Gojek 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 Bayu Buana with a short position of GoTo Gojek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bayu Buana and GoTo Gojek.
Diversification Opportunities for Bayu Buana and GoTo Gojek
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bayu and GoTo is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Bayu Buana Tbk and GoTo Gojek Tokopedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GoTo Gojek Tokopedia and Bayu Buana 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 Bayu Buana Tbk are associated (or correlated) with GoTo Gojek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GoTo Gojek Tokopedia has no effect on the direction of Bayu Buana i.e., Bayu Buana and GoTo Gojek go up and down completely randomly.
Pair Corralation between Bayu Buana and GoTo Gojek
Assuming the 90 days trading horizon Bayu Buana Tbk is expected to under-perform the GoTo Gojek. But the stock apears to be less risky and, when comparing its historical volatility, Bayu Buana Tbk is 4.14 times less risky than GoTo Gojek. The stock trades about -0.16 of its potential returns per unit of risk. The GoTo Gojek Tokopedia is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 7,100 in GoTo Gojek Tokopedia on November 3, 2024 and sell it today you would earn a total of 1,200 from holding GoTo Gojek Tokopedia or generate 16.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bayu Buana Tbk vs. GoTo Gojek Tokopedia
Performance |
| Timeline |
| Bayu Buana Tbk |
| GoTo Gojek Tokopedia |
Bayu Buana and GoTo Gojek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bayu Buana and GoTo Gojek
The main advantage of trading using opposite Bayu Buana and GoTo Gojek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bayu Buana position performs unexpectedly, GoTo Gojek 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 GoTo Gojek will offset losses from the drop in GoTo Gojek's long position.| Bayu Buana vs. Catur Sentosa Adiprana | Bayu Buana vs. Fast Food Indonesia | Bayu Buana vs. Hero Supermarket Tbk | Bayu Buana vs. Graha Layar Prima |
| GoTo Gojek vs. PT Bukalapak | GoTo Gojek vs. Bank Artos Indonesia | GoTo Gojek vs. Elang Mahkota Teknologi | GoTo Gojek vs. Adaro Minerals Indonesia |
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 Stocks Directory module to find actively traded stocks across global markets.
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