Correlation Between Berkah Beton and Bakrie Sumatera
Can any of the company-specific risk be diversified away by investing in both Berkah Beton and Bakrie Sumatera 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 Bakrie Sumatera 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 Bakrie Sumatera Plantations, you can compare the effects of market volatilities on Berkah Beton and Bakrie Sumatera 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 Bakrie Sumatera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berkah Beton and Bakrie Sumatera.
Diversification Opportunities for Berkah Beton and Bakrie Sumatera
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Berkah and Bakrie is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Berkah Beton Sadaya and Bakrie Sumatera Plantations in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bakrie Sumatera Plan 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 Bakrie Sumatera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bakrie Sumatera Plan has no effect on the direction of Berkah Beton i.e., Berkah Beton and Bakrie Sumatera go up and down completely randomly.
Pair Corralation between Berkah Beton and Bakrie Sumatera
Assuming the 90 days trading horizon Berkah Beton Sadaya is expected to under-perform the Bakrie Sumatera. In addition to that, Berkah Beton is 3.99 times more volatile than Bakrie Sumatera Plantations. It trades about -0.08 of its total potential returns per unit of risk. Bakrie Sumatera Plantations is currently generating about 0.04 per unit of volatility. If you would invest 11,100 in Bakrie Sumatera Plantations on August 27, 2024 and sell it today you would earn a total of 1,600 from holding Bakrie Sumatera Plantations or generate 14.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Berkah Beton Sadaya vs. Bakrie Sumatera Plantations
Performance |
| Timeline |
| Berkah Beton Sadaya |
| Bakrie Sumatera Plan |
Berkah Beton and Bakrie Sumatera Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Berkah Beton and Bakrie Sumatera
The main advantage of trading using opposite Berkah Beton and Bakrie Sumatera positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berkah Beton position performs unexpectedly, Bakrie Sumatera 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 Bakrie Sumatera will offset losses from the drop in Bakrie Sumatera'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 |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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