Correlation Between Barito Pacific and Cita Mineral
Can any of the company-specific risk be diversified away by investing in both Barito Pacific and Cita Mineral 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 Barito Pacific and Cita Mineral into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barito Pacific Tbk and Cita Mineral Investindo, you can compare the effects of market volatilities on Barito Pacific and Cita Mineral 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 Barito Pacific with a short position of Cita Mineral. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barito Pacific and Cita Mineral.
Diversification Opportunities for Barito Pacific and Cita Mineral
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Barito and Cita is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Barito Pacific Tbk and Cita Mineral Investindo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cita Mineral Investindo and Barito Pacific 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 Barito Pacific Tbk are associated (or correlated) with Cita Mineral. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cita Mineral Investindo has no effect on the direction of Barito Pacific i.e., Barito Pacific and Cita Mineral go up and down completely randomly.
Pair Corralation between Barito Pacific and Cita Mineral
If you would invest 342,544 in Cita Mineral Investindo on November 5, 2024 and sell it today you would lose (7,544) from holding Cita Mineral Investindo or give up 2.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 0.21% |
| Values | Daily Returns |
Barito Pacific Tbk vs. Cita Mineral Investindo
Performance |
| Timeline |
| Barito Pacific Tbk |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Cita Mineral Investindo |
Barito Pacific and Cita Mineral Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barito Pacific and Cita Mineral
The main advantage of trading using opposite Barito Pacific and Cita Mineral positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barito Pacific position performs unexpectedly, Cita Mineral 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 Cita Mineral will offset losses from the drop in Cita Mineral's long position.| Barito Pacific vs. Indah Kiat Pulp | Barito Pacific vs. Medco Energi Internasional | Barito Pacific vs. Vale Indonesia Tbk | Barito Pacific vs. Charoen Pokphand Indonesia |
| Cita Mineral vs. Citatah Tbk | Cita Mineral vs. Indo Kordsa Tbk | Cita Mineral vs. Central Omega Resources | Cita Mineral vs. Betonjaya Manunggal 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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