Correlation Between Estika Tata and PT Toba
Can any of the company-specific risk be diversified away by investing in both Estika Tata and PT Toba 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 Estika Tata and PT Toba into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Estika Tata Tiara and PT Toba Surimi, you can compare the effects of market volatilities on Estika Tata and PT Toba 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 Estika Tata with a short position of PT Toba. Check out your portfolio center. Please also check ongoing floating volatility patterns of Estika Tata and PT Toba.
Diversification Opportunities for Estika Tata and PT Toba
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Estika and CRAB is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Estika Tata Tiara and PT Toba Surimi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Toba Surimi and Estika Tata 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 Estika Tata Tiara are associated (or correlated) with PT Toba. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Toba Surimi has no effect on the direction of Estika Tata i.e., Estika Tata and PT Toba go up and down completely randomly.
Pair Corralation between Estika Tata and PT Toba
Assuming the 90 days trading horizon Estika Tata Tiara is expected to under-perform the PT Toba. In addition to that, Estika Tata is 3.4 times more volatile than PT Toba Surimi. It trades about -0.08 of its total potential returns per unit of risk. PT Toba Surimi is currently generating about -0.05 per unit of volatility. If you would invest 28,807 in PT Toba Surimi on August 31, 2024 and sell it today you would lose (2,607) from holding PT Toba Surimi or give up 9.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Estika Tata Tiara vs. PT Toba Surimi
Performance |
| Timeline |
| Estika Tata Tiara |
| PT Toba Surimi |
Estika Tata and PT Toba Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Estika Tata and PT Toba
The main advantage of trading using opposite Estika Tata and PT Toba positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Estika Tata position performs unexpectedly, PT Toba 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 PT Toba will offset losses from the drop in PT Toba's long position.| Estika Tata vs. Garudafood Putra Putri | Estika Tata vs. Campina Ice Cream | Estika Tata vs. PT Wahana Interfood | Estika Tata vs. Era Mandiri Cemerlang |
| PT Toba vs. Garudafood Putra Putri | PT Toba vs. Estika Tata Tiara | PT Toba vs. Campina Ice Cream | PT Toba vs. PT Wahana Interfood |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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