Correlation Between Garuda Metalindo and Graha Andrasentra
Can any of the company-specific risk be diversified away by investing in both Garuda Metalindo and Graha Andrasentra 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 Garuda Metalindo and Graha Andrasentra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Garuda Metalindo Tbk and Graha Andrasentra Propertindo, you can compare the effects of market volatilities on Garuda Metalindo and Graha Andrasentra 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 Garuda Metalindo with a short position of Graha Andrasentra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Garuda Metalindo and Graha Andrasentra.
Diversification Opportunities for Garuda Metalindo and Graha Andrasentra
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Garuda and Graha is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Garuda Metalindo Tbk and Graha Andrasentra Propertindo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graha Andrasentra and Garuda Metalindo 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 Garuda Metalindo Tbk are associated (or correlated) with Graha Andrasentra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graha Andrasentra has no effect on the direction of Garuda Metalindo i.e., Garuda Metalindo and Graha Andrasentra go up and down completely randomly.
Pair Corralation between Garuda Metalindo and Graha Andrasentra
Assuming the 90 days trading horizon Garuda Metalindo Tbk is expected to generate 0.28 times more return on investment than Graha Andrasentra. However, Garuda Metalindo Tbk is 3.57 times less risky than Graha Andrasentra. It trades about 0.09 of its potential returns per unit of risk. Graha Andrasentra Propertindo is currently generating about -0.05 per unit of risk. If you would invest 78,348 in Garuda Metalindo Tbk on November 28, 2024 and sell it today you would earn a total of 57,152 from holding Garuda Metalindo Tbk or generate 72.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Garuda Metalindo Tbk vs. Graha Andrasentra Propertindo
Performance |
| Timeline |
| Garuda Metalindo Tbk |
| Graha Andrasentra |
Garuda Metalindo and Graha Andrasentra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Garuda Metalindo and Graha Andrasentra
The main advantage of trading using opposite Garuda Metalindo and Graha Andrasentra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Garuda Metalindo position performs unexpectedly, Graha Andrasentra 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 Graha Andrasentra will offset losses from the drop in Graha Andrasentra's long position.| Garuda Metalindo vs. Indo Kordsa Tbk | Garuda Metalindo vs. Indospring Tbk | Garuda Metalindo vs. Kabelindo Murni Tbk | Garuda Metalindo vs. Blue Bird Tbk |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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