Correlation Between Wulandari Bangun and Weha Transportasi
Can any of the company-specific risk be diversified away by investing in both Wulandari Bangun and Weha Transportasi 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 Wulandari Bangun and Weha Transportasi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wulandari Bangun Laksana and Weha Transportasi Indonesia, you can compare the effects of market volatilities on Wulandari Bangun and Weha Transportasi 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 Wulandari Bangun with a short position of Weha Transportasi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wulandari Bangun and Weha Transportasi.
Diversification Opportunities for Wulandari Bangun and Weha Transportasi
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wulandari and Weha is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Wulandari Bangun Laksana and Weha Transportasi Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weha Transportasi and Wulandari Bangun 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 Wulandari Bangun Laksana are associated (or correlated) with Weha Transportasi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weha Transportasi has no effect on the direction of Wulandari Bangun i.e., Wulandari Bangun and Weha Transportasi go up and down completely randomly.
Pair Corralation between Wulandari Bangun and Weha Transportasi
Assuming the 90 days trading horizon Wulandari Bangun Laksana is expected to generate 1.34 times more return on investment than Weha Transportasi. However, Wulandari Bangun is 1.34 times more volatile than Weha Transportasi Indonesia. It trades about 0.02 of its potential returns per unit of risk. Weha Transportasi Indonesia is currently generating about 0.0 per unit of risk. If you would invest 4,924 in Wulandari Bangun Laksana on September 12, 2024 and sell it today you would earn a total of 76.00 from holding Wulandari Bangun Laksana or generate 1.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wulandari Bangun Laksana vs. Weha Transportasi Indonesia
Performance |
| Timeline |
| Wulandari Bangun Laksana |
| Weha Transportasi |
Wulandari Bangun and Weha Transportasi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wulandari Bangun and Weha Transportasi
The main advantage of trading using opposite Wulandari Bangun and Weha Transportasi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wulandari Bangun position performs unexpectedly, Weha Transportasi 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 Weha Transportasi will offset losses from the drop in Weha Transportasi's long position.| Wulandari Bangun vs. Weha Transportasi Indonesia | Wulandari Bangun vs. Communication Cable Systems | Wulandari Bangun vs. Yelooo Integra Datanet | Wulandari Bangun vs. Nanotech Indonesia Global |
| Weha Transportasi vs. PT Temas Tbk | Weha Transportasi vs. Dosni Roha Indonesia | Weha Transportasi vs. Rig Tenders Tbk | Weha Transportasi vs. Samudera Indonesia 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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