Correlation Between Berkah Prima and Communication Cable
Can any of the company-specific risk be diversified away by investing in both Berkah Prima and Communication Cable 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 Prima and Communication Cable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Berkah Prima Perkasa and Communication Cable Systems, you can compare the effects of market volatilities on Berkah Prima and Communication Cable 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 Prima with a short position of Communication Cable. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berkah Prima and Communication Cable.
Diversification Opportunities for Berkah Prima and Communication Cable
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Berkah and Communication is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Berkah Prima Perkasa and Communication Cable Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Communication Cable and Berkah Prima 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 Prima Perkasa are associated (or correlated) with Communication Cable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Communication Cable has no effect on the direction of Berkah Prima i.e., Berkah Prima and Communication Cable go up and down completely randomly.
Pair Corralation between Berkah Prima and Communication Cable
Assuming the 90 days trading horizon Berkah Prima Perkasa is expected to under-perform the Communication Cable. But the stock apears to be less risky and, when comparing its historical volatility, Berkah Prima Perkasa is 4.09 times less risky than Communication Cable. The stock trades about -0.04 of its potential returns per unit of risk. The Communication Cable Systems is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 24,600 in Communication Cable Systems on August 29, 2024 and sell it today you would earn a total of 1,400 from holding Communication Cable Systems or generate 5.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Berkah Prima Perkasa vs. Communication Cable Systems
Performance |
| Timeline |
| Berkah Prima Perkasa |
| Communication Cable |
Berkah Prima and Communication Cable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Berkah Prima and Communication Cable
The main advantage of trading using opposite Berkah Prima and Communication Cable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berkah Prima position performs unexpectedly, Communication Cable 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 Communication Cable will offset losses from the drop in Communication Cable's long position.| Berkah Prima vs. Multipolar Technology Tbk | Berkah Prima vs. Nusantara Voucher Distribution | Berkah Prima vs. Hensel Davest Indonesia | Berkah Prima vs. Anabatic Technologies Tbk |
| Communication Cable vs. Hartadinata Abadi Tbk | Communication Cable vs. Estika Tata Tiara | Communication Cable vs. Garudafood Putra Putri | Communication Cable vs. PT Indonesia Kendaraan |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |