Correlation Between Bakrie Brothers and Trimitra Prawara
Can any of the company-specific risk be diversified away by investing in both Bakrie Brothers and Trimitra Prawara 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 Bakrie Brothers and Trimitra Prawara into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bakrie Brothers Tbk and Trimitra Prawara Goldland, you can compare the effects of market volatilities on Bakrie Brothers and Trimitra Prawara 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 Bakrie Brothers with a short position of Trimitra Prawara. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bakrie Brothers and Trimitra Prawara.
Diversification Opportunities for Bakrie Brothers and Trimitra Prawara
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Bakrie and Trimitra is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Bakrie Brothers Tbk and Trimitra Prawara Goldland in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trimitra Prawara Goldland and Bakrie Brothers 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 Bakrie Brothers Tbk are associated (or correlated) with Trimitra Prawara. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trimitra Prawara Goldland has no effect on the direction of Bakrie Brothers i.e., Bakrie Brothers and Trimitra Prawara go up and down completely randomly.
Pair Corralation between Bakrie Brothers and Trimitra Prawara
Assuming the 90 days trading horizon Bakrie Brothers Tbk is expected to under-perform the Trimitra Prawara. In addition to that, Bakrie Brothers is 1.6 times more volatile than Trimitra Prawara Goldland. It trades about -0.13 of its total potential returns per unit of risk. Trimitra Prawara Goldland is currently generating about -0.15 per unit of volatility. If you would invest 2,800 in Trimitra Prawara Goldland on August 28, 2024 and sell it today you would lose (300.00) from holding Trimitra Prawara Goldland or give up 10.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bakrie Brothers Tbk vs. Trimitra Prawara Goldland
Performance |
| Timeline |
| Bakrie Brothers Tbk |
| Trimitra Prawara Goldland |
Bakrie Brothers and Trimitra Prawara Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bakrie Brothers and Trimitra Prawara
The main advantage of trading using opposite Bakrie Brothers and Trimitra Prawara positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bakrie Brothers position performs unexpectedly, Trimitra Prawara 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 Trimitra Prawara will offset losses from the drop in Trimitra Prawara's long position.The idea behind Bakrie Brothers Tbk and Trimitra Prawara Goldland pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Trimitra Prawara vs. Repower Asia Indonesia | Trimitra Prawara vs. DMS Propertindo Tbk | Trimitra Prawara vs. Diamond Citra Propertindo | Trimitra Prawara vs. Integra Indocabinet 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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