Correlation Between Bhuwanatala Indah and Arwana Citramulia
Can any of the company-specific risk be diversified away by investing in both Bhuwanatala Indah and Arwana Citramulia 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 Bhuwanatala Indah and Arwana Citramulia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bhuwanatala Indah Permai and Arwana Citramulia Tbk, you can compare the effects of market volatilities on Bhuwanatala Indah and Arwana Citramulia 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 Bhuwanatala Indah with a short position of Arwana Citramulia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bhuwanatala Indah and Arwana Citramulia.
Diversification Opportunities for Bhuwanatala Indah and Arwana Citramulia
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bhuwanatala and Arwana is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Bhuwanatala Indah Permai and Arwana Citramulia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arwana Citramulia Tbk and Bhuwanatala Indah 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 Bhuwanatala Indah Permai are associated (or correlated) with Arwana Citramulia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arwana Citramulia Tbk has no effect on the direction of Bhuwanatala Indah i.e., Bhuwanatala Indah and Arwana Citramulia go up and down completely randomly.
Pair Corralation between Bhuwanatala Indah and Arwana Citramulia
Assuming the 90 days trading horizon Bhuwanatala Indah Permai is expected to under-perform the Arwana Citramulia. In addition to that, Bhuwanatala Indah is 1.6 times more volatile than Arwana Citramulia Tbk. It trades about -0.32 of its total potential returns per unit of risk. Arwana Citramulia Tbk is currently generating about 0.07 per unit of volatility. If you would invest 62,000 in Arwana Citramulia Tbk on November 28, 2024 and sell it today you would earn a total of 1,500 from holding Arwana Citramulia Tbk or generate 2.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bhuwanatala Indah Permai vs. Arwana Citramulia Tbk
Performance |
| Timeline |
| Bhuwanatala Indah Permai |
| Arwana Citramulia Tbk |
Bhuwanatala Indah and Arwana Citramulia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bhuwanatala Indah and Arwana Citramulia
The main advantage of trading using opposite Bhuwanatala Indah and Arwana Citramulia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bhuwanatala Indah position performs unexpectedly, Arwana Citramulia 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 Arwana Citramulia will offset losses from the drop in Arwana Citramulia's long position.| Bhuwanatala Indah vs. Duta Anggada Realty | Bhuwanatala Indah vs. Bukit Darmo Property | Bhuwanatala Indah vs. Duta Pertiwi Tbk | Bhuwanatala Indah vs. Bintang Mitra Semestaraya |
| Arwana Citramulia vs. Asahimas Flat Glass | Arwana Citramulia vs. Astra Graphia Tbk | Arwana Citramulia vs. Ekadharma International Tbk | Arwana Citramulia vs. Akasha Wira International |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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