Correlation Between Berkah Beton and Lionmesh Prima
Can any of the company-specific risk be diversified away by investing in both Berkah Beton and Lionmesh Prima 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 Berkah Beton and Lionmesh Prima into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Berkah Beton Sadaya and Lionmesh Prima Tbk, you can compare the effects of market volatilities on Berkah Beton and Lionmesh Prima 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 Berkah Beton with a short position of Lionmesh Prima. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berkah Beton and Lionmesh Prima.
Diversification Opportunities for Berkah Beton and Lionmesh Prima
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Berkah and Lionmesh is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Berkah Beton Sadaya and Lionmesh Prima Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lionmesh Prima Tbk and Berkah Beton 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 Berkah Beton Sadaya are associated (or correlated) with Lionmesh Prima. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lionmesh Prima Tbk has no effect on the direction of Berkah Beton i.e., Berkah Beton and Lionmesh Prima go up and down completely randomly.
Pair Corralation between Berkah Beton and Lionmesh Prima
Assuming the 90 days trading horizon Berkah Beton Sadaya is expected to under-perform the Lionmesh Prima. In addition to that, Berkah Beton is 4.97 times more volatile than Lionmesh Prima Tbk. It trades about -0.07 of its total potential returns per unit of risk. Lionmesh Prima Tbk is currently generating about -0.03 per unit of volatility. If you would invest 39,600 in Lionmesh Prima Tbk on September 3, 2024 and sell it today you would lose (4,600) from holding Lionmesh Prima Tbk or give up 11.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Berkah Beton Sadaya vs. Lionmesh Prima Tbk
Performance |
| Timeline |
| Berkah Beton Sadaya |
| Lionmesh Prima Tbk |
Berkah Beton and Lionmesh Prima Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Berkah Beton and Lionmesh Prima
The main advantage of trading using opposite Berkah Beton and Lionmesh Prima positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berkah Beton position performs unexpectedly, Lionmesh Prima 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 Lionmesh Prima will offset losses from the drop in Lionmesh Prima's long position.| Berkah Beton vs. Bk Harda Internasional | Berkah Beton vs. Bank Net Indonesia | Berkah Beton vs. Bank Yudha Bhakti | Berkah Beton vs. Medikaloka Hermina PT |
| Lionmesh Prima vs. Lion Metal Works | Lionmesh Prima vs. Pelangi Indah Canindo | Lionmesh Prima vs. Indal Aluminium Industry | Lionmesh Prima vs. Tembaga Mulia Semanan |
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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