Correlation Between Bumi Serpong and Bakrieland Development
Can any of the company-specific risk be diversified away by investing in both Bumi Serpong and Bakrieland Development 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 Bumi Serpong and Bakrieland Development into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bumi Serpong Damai and Bakrieland Development Tbk, you can compare the effects of market volatilities on Bumi Serpong and Bakrieland Development 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 Bumi Serpong with a short position of Bakrieland Development. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bumi Serpong and Bakrieland Development.
Diversification Opportunities for Bumi Serpong and Bakrieland Development
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bumi and Bakrieland is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Bumi Serpong Damai and Bakrieland Development Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bakrieland Development and Bumi Serpong 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 Bumi Serpong Damai are associated (or correlated) with Bakrieland Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bakrieland Development has no effect on the direction of Bumi Serpong i.e., Bumi Serpong and Bakrieland Development go up and down completely randomly.
Pair Corralation between Bumi Serpong and Bakrieland Development
Assuming the 90 days trading horizon Bumi Serpong Damai is expected to generate 0.4 times more return on investment than Bakrieland Development. However, Bumi Serpong Damai is 2.51 times less risky than Bakrieland Development. It trades about -0.62 of its potential returns per unit of risk. Bakrieland Development Tbk is currently generating about -0.28 per unit of risk. If you would invest 126,000 in Bumi Serpong Damai on August 24, 2024 and sell it today you would lose (26,500) from holding Bumi Serpong Damai or give up 21.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Bumi Serpong Damai vs. Bakrieland Development Tbk
Performance |
| Timeline |
| Bumi Serpong Damai |
| Bakrieland Development |
Bumi Serpong and Bakrieland Development Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bumi Serpong and Bakrieland Development
The main advantage of trading using opposite Bumi Serpong and Bakrieland Development positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bumi Serpong position performs unexpectedly, Bakrieland Development 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 Bakrieland Development will offset losses from the drop in Bakrieland Development's long position.| Bumi Serpong vs. Alam Sutera Realty | Bumi Serpong vs. Ciputra Development Tbk | Bumi Serpong vs. Summarecon Agung Tbk | Bumi Serpong vs. Pakuwon Jati Tbk |
| Bakrieland Development vs. Bakrie Brothers Tbk | Bakrieland Development vs. Bakrie Sumatera Plantations | Bakrieland Development vs. Energi Mega Persada | Bakrieland Development vs. Darma Henwa 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |