Correlation Between Bakrie Brothers and Campina Ice
Can any of the company-specific risk be diversified away by investing in both Bakrie Brothers and Campina Ice 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 Campina Ice 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 Campina Ice Cream, you can compare the effects of market volatilities on Bakrie Brothers and Campina Ice 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 Campina Ice. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bakrie Brothers and Campina Ice.
Diversification Opportunities for Bakrie Brothers and Campina Ice
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bakrie and Campina is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Bakrie Brothers Tbk and Campina Ice Cream in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Campina Ice Cream 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 Campina Ice. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Campina Ice Cream has no effect on the direction of Bakrie Brothers i.e., Bakrie Brothers and Campina Ice go up and down completely randomly.
Pair Corralation between Bakrie Brothers and Campina Ice
Assuming the 90 days trading horizon Bakrie Brothers Tbk is expected to generate 1.27 times more return on investment than Campina Ice. However, Bakrie Brothers is 1.27 times more volatile than Campina Ice Cream. It trades about 0.01 of its potential returns per unit of risk. Campina Ice Cream is currently generating about -0.41 per unit of risk. If you would invest 3,600 in Bakrie Brothers Tbk on November 28, 2024 and sell it today you would earn a total of 0.00 from holding Bakrie Brothers Tbk or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bakrie Brothers Tbk vs. Campina Ice Cream
Performance |
| Timeline |
| Bakrie Brothers Tbk |
| Campina Ice Cream |
Bakrie Brothers and Campina Ice Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bakrie Brothers and Campina Ice
The main advantage of trading using opposite Bakrie Brothers and Campina Ice positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bakrie Brothers position performs unexpectedly, Campina Ice 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 Campina Ice will offset losses from the drop in Campina Ice's long position.| Bakrie Brothers vs. Bakrieland Development Tbk | Bakrie Brothers vs. Bakrie Sumatera Plantations | Bakrie Brothers vs. Energi Mega Persada | Bakrie Brothers vs. Darma Henwa Tbk |
| Campina Ice vs. Sariguna Primatirta PT | Campina Ice vs. Garudafood Putra Putri | Campina Ice vs. Buyung Poetra Sembada | Campina Ice 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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