Correlation Between Bakrie Brothers and PT Wahana
Can any of the company-specific risk be diversified away by investing in both Bakrie Brothers and PT Wahana 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 PT Wahana 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 PT Wahana Interfood, you can compare the effects of market volatilities on Bakrie Brothers and PT Wahana 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 PT Wahana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bakrie Brothers and PT Wahana.
Diversification Opportunities for Bakrie Brothers and PT Wahana
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Bakrie and COCO is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Bakrie Brothers Tbk and PT Wahana Interfood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Wahana Interfood 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 PT Wahana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Wahana Interfood has no effect on the direction of Bakrie Brothers i.e., Bakrie Brothers and PT Wahana go up and down completely randomly.
Pair Corralation between Bakrie Brothers and PT Wahana
Assuming the 90 days trading horizon Bakrie Brothers Tbk is expected to generate 0.87 times more return on investment than PT Wahana. However, Bakrie Brothers Tbk is 1.16 times less risky than PT Wahana. It trades about -0.01 of its potential returns per unit of risk. PT Wahana Interfood is currently generating about -0.04 per unit of risk. If you would invest 7,000 in Bakrie Brothers Tbk on August 30, 2024 and sell it today you would lose (2,400) from holding Bakrie Brothers Tbk or give up 34.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Bakrie Brothers Tbk vs. PT Wahana Interfood
Performance |
| Timeline |
| Bakrie Brothers Tbk |
| PT Wahana Interfood |
Bakrie Brothers and PT Wahana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bakrie Brothers and PT Wahana
The main advantage of trading using opposite Bakrie Brothers and PT Wahana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bakrie Brothers position performs unexpectedly, PT Wahana 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 PT Wahana will offset losses from the drop in PT Wahana'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 |
| PT Wahana vs. Garudafood Putra Putri | PT Wahana vs. Sentra Food Indonesia | PT Wahana vs. Campina Ice Cream | PT Wahana vs. Diamond Food Indonesia |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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