Correlation Between Graha Layar and Bakrie Brothers
Can any of the company-specific risk be diversified away by investing in both Graha Layar and Bakrie Brothers 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 Graha Layar and Bakrie Brothers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Graha Layar Prima and Bakrie Brothers Tbk, you can compare the effects of market volatilities on Graha Layar and Bakrie Brothers 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 Graha Layar with a short position of Bakrie Brothers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graha Layar and Bakrie Brothers.
Diversification Opportunities for Graha Layar and Bakrie Brothers
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Graha and Bakrie is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Graha Layar Prima and Bakrie Brothers Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bakrie Brothers Tbk and Graha Layar 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 Graha Layar Prima are associated (or correlated) with Bakrie Brothers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bakrie Brothers Tbk has no effect on the direction of Graha Layar i.e., Graha Layar and Bakrie Brothers go up and down completely randomly.
Pair Corralation between Graha Layar and Bakrie Brothers
Assuming the 90 days trading horizon Graha Layar Prima is expected to generate 0.26 times more return on investment than Bakrie Brothers. However, Graha Layar Prima is 3.81 times less risky than Bakrie Brothers. It trades about -0.31 of its potential returns per unit of risk. Bakrie Brothers Tbk is currently generating about -0.11 per unit of risk. If you would invest 220,000 in Graha Layar Prima on August 30, 2024 and sell it today you would lose (20,000) from holding Graha Layar Prima or give up 9.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Graha Layar Prima vs. Bakrie Brothers Tbk
Performance |
| Timeline |
| Graha Layar Prima |
| Bakrie Brothers Tbk |
Graha Layar and Bakrie Brothers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Graha Layar and Bakrie Brothers
The main advantage of trading using opposite Graha Layar and Bakrie Brothers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graha Layar position performs unexpectedly, Bakrie Brothers 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 Brothers will offset losses from the drop in Bakrie Brothers' long position.| Graha Layar vs. Electronic City Indonesia | Graha Layar vs. Bayu Buana Tbk | Graha Layar vs. Bintang Oto Global | Graha Layar vs. Garuda Metalindo Tbk |
| Bakrie Brothers vs. Bakrieland Development Tbk | Bakrie Brothers vs. Bakrie Sumatera Plantations | Bakrie Brothers vs. Energi Mega Persada | Bakrie Brothers vs. Darma Henwa 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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