Correlation Between Blue Bird and Bali Towerindo
Can any of the company-specific risk be diversified away by investing in both Blue Bird and Bali Towerindo 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 Blue Bird and Bali Towerindo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blue Bird Tbk and Bali Towerindo Sentra, you can compare the effects of market volatilities on Blue Bird and Bali Towerindo 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 Blue Bird with a short position of Bali Towerindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blue Bird and Bali Towerindo.
Diversification Opportunities for Blue Bird and Bali Towerindo
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Blue and Bali is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Blue Bird Tbk and Bali Towerindo Sentra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bali Towerindo Sentra and Blue Bird 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 Blue Bird Tbk are associated (or correlated) with Bali Towerindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bali Towerindo Sentra has no effect on the direction of Blue Bird i.e., Blue Bird and Bali Towerindo go up and down completely randomly.
Pair Corralation between Blue Bird and Bali Towerindo
Assuming the 90 days trading horizon Blue Bird Tbk is expected to generate 0.55 times more return on investment than Bali Towerindo. However, Blue Bird Tbk is 1.83 times less risky than Bali Towerindo. It trades about 0.11 of its potential returns per unit of risk. Bali Towerindo Sentra is currently generating about -0.08 per unit of risk. If you would invest 157,500 in Blue Bird Tbk on November 4, 2024 and sell it today you would earn a total of 5,500 from holding Blue Bird Tbk or generate 3.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blue Bird Tbk vs. Bali Towerindo Sentra
Performance |
| Timeline |
| Blue Bird Tbk |
| Bali Towerindo Sentra |
Blue Bird and Bali Towerindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blue Bird and Bali Towerindo
The main advantage of trading using opposite Blue Bird and Bali Towerindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blue Bird position performs unexpectedly, Bali Towerindo 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 Bali Towerindo will offset losses from the drop in Bali Towerindo's long position.| Blue Bird vs. Adi Sarana Armada | Blue Bird vs. Mitra Keluarga Karyasehat | Blue Bird vs. Matahari Department Store | Blue Bird vs. Soechi Lines Tbk |
| Bali Towerindo vs. Fast Food Indonesia | Bali Towerindo vs. Centratama Telekomunikasi Ind | Bali Towerindo vs. Sumber Alfaria Trijaya | Bali Towerindo vs. Bayu Buana 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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