Correlation Between Indo Kordsa and Bukaka Teknik
Can any of the company-specific risk be diversified away by investing in both Indo Kordsa and Bukaka Teknik 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 Indo Kordsa and Bukaka Teknik into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Indo Kordsa Tbk and Bukaka Teknik Utama, you can compare the effects of market volatilities on Indo Kordsa and Bukaka Teknik 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 Indo Kordsa with a short position of Bukaka Teknik. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indo Kordsa and Bukaka Teknik.
Diversification Opportunities for Indo Kordsa and Bukaka Teknik
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Indo and Bukaka is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Indo Kordsa Tbk and Bukaka Teknik Utama in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bukaka Teknik Utama and Indo Kordsa 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 Indo Kordsa Tbk are associated (or correlated) with Bukaka Teknik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bukaka Teknik Utama has no effect on the direction of Indo Kordsa i.e., Indo Kordsa and Bukaka Teknik go up and down completely randomly.
Pair Corralation between Indo Kordsa and Bukaka Teknik
Assuming the 90 days trading horizon Indo Kordsa Tbk is expected to generate 1.69 times more return on investment than Bukaka Teknik. However, Indo Kordsa is 1.69 times more volatile than Bukaka Teknik Utama. It trades about 0.01 of its potential returns per unit of risk. Bukaka Teknik Utama is currently generating about -0.07 per unit of risk. If you would invest 586,385 in Indo Kordsa Tbk on October 25, 2024 and sell it today you would lose (1,385) from holding Indo Kordsa Tbk or give up 0.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.33% |
| Values | Daily Returns |
Indo Kordsa Tbk vs. Bukaka Teknik Utama
Performance |
| Timeline |
| Indo Kordsa Tbk |
| Bukaka Teknik Utama |
Indo Kordsa and Bukaka Teknik Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indo Kordsa and Bukaka Teknik
The main advantage of trading using opposite Indo Kordsa and Bukaka Teknik positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indo Kordsa position performs unexpectedly, Bukaka Teknik 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 Bukaka Teknik will offset losses from the drop in Bukaka Teknik's long position.| Indo Kordsa vs. Goodyear Indonesia Tbk | Indo Kordsa vs. Sepatu Bata Tbk | Indo Kordsa vs. Indospring Tbk | Indo Kordsa vs. Ever Shine Textile |
| Bukaka Teknik vs. Indo Kordsa Tbk | Bukaka Teknik vs. Wilmar Cahaya Indonesia | Bukaka Teknik vs. Citra Marga Nusaphala | Bukaka Teknik vs. Darya Varia Laboratoria 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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