Correlation Between Bumi Benowo and Pikko Land
Can any of the company-specific risk be diversified away by investing in both Bumi Benowo and Pikko Land 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 Bumi Benowo and Pikko Land into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bumi Benowo Sukses and Pikko Land Development, you can compare the effects of market volatilities on Bumi Benowo and Pikko Land 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 Bumi Benowo with a short position of Pikko Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bumi Benowo and Pikko Land.
Diversification Opportunities for Bumi Benowo and Pikko Land
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bumi and Pikko is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Bumi Benowo Sukses and Pikko Land Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pikko Land Development and Bumi Benowo 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 Bumi Benowo Sukses are associated (or correlated) with Pikko Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pikko Land Development has no effect on the direction of Bumi Benowo i.e., Bumi Benowo and Pikko Land go up and down completely randomly.
Pair Corralation between Bumi Benowo and Pikko Land
Assuming the 90 days trading horizon Bumi Benowo Sukses is expected to generate 1.37 times more return on investment than Pikko Land. However, Bumi Benowo is 1.37 times more volatile than Pikko Land Development. It trades about 0.1 of its potential returns per unit of risk. Pikko Land Development is currently generating about 0.0 per unit of risk. If you would invest 5,500 in Bumi Benowo Sukses on August 28, 2024 and sell it today you would earn a total of 14,700 from holding Bumi Benowo Sukses or generate 267.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bumi Benowo Sukses vs. Pikko Land Development
Performance |
| Timeline |
| Bumi Benowo Sukses |
| Pikko Land Development |
Bumi Benowo and Pikko Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bumi Benowo and Pikko Land
The main advantage of trading using opposite Bumi Benowo and Pikko Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bumi Benowo position performs unexpectedly, Pikko Land 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 Pikko Land will offset losses from the drop in Pikko Land's long position.| Bumi Benowo vs. Indo Kordsa Tbk | Bumi Benowo vs. Wilmar Cahaya Indonesia | Bumi Benowo vs. Citra Marga Nusaphala | Bumi Benowo vs. Darya Varia Laboratoria Tbk |
| Pikko Land vs. Ristia Bintang Mahkotasejati | Pikko Land vs. Suryamas Dutamakmur Tbk | Pikko Land vs. Indonesia Prima Property | Pikko Land vs. Pudjiadi Prestige 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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