Correlation Between Bintang Oto and Blue Bird
Can any of the company-specific risk be diversified away by investing in both Bintang Oto and Blue Bird 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 Bintang Oto and Blue Bird into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bintang Oto Global and Blue Bird Tbk, you can compare the effects of market volatilities on Bintang Oto and Blue Bird 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 Bintang Oto with a short position of Blue Bird. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bintang Oto and Blue Bird.
Diversification Opportunities for Bintang Oto and Blue Bird
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bintang and Blue is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Bintang Oto Global and Blue Bird Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Bird Tbk and Bintang Oto 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 Bintang Oto Global are associated (or correlated) with Blue Bird. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Bird Tbk has no effect on the direction of Bintang Oto i.e., Bintang Oto and Blue Bird go up and down completely randomly.
Pair Corralation between Bintang Oto and Blue Bird
Assuming the 90 days trading horizon Bintang Oto Global is expected to generate 0.59 times more return on investment than Blue Bird. However, Bintang Oto Global is 1.7 times less risky than Blue Bird. It trades about -0.23 of its potential returns per unit of risk. Blue Bird Tbk is currently generating about -0.25 per unit of risk. If you would invest 57,000 in Bintang Oto Global on September 1, 2024 and sell it today you would lose (3,000) from holding Bintang Oto Global or give up 5.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bintang Oto Global vs. Blue Bird Tbk
Performance |
| Timeline |
| Bintang Oto Global |
| Blue Bird Tbk |
Bintang Oto and Blue Bird Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bintang Oto and Blue Bird
The main advantage of trading using opposite Bintang Oto and Blue Bird positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bintang Oto position performs unexpectedly, Blue Bird 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 Blue Bird will offset losses from the drop in Blue Bird's long position.| Bintang Oto vs. Japfa Comfeed Indonesia | Bintang Oto vs. Charoen Pokphand Indonesia | Bintang Oto vs. Erajaya Swasembada Tbk | Bintang Oto vs. Indofood Cbp Sukses |
| Blue Bird vs. Matahari Department Store | Blue Bird vs. Multi Medika Internasional | Blue Bird vs. Visi Media Asia | Blue Bird vs. Bayan Resources 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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