Correlation Between PT Bukalapak and Smartfren Telecom
Can any of the company-specific risk be diversified away by investing in both PT Bukalapak and Smartfren Telecom 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 PT Bukalapak and Smartfren Telecom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Bukalapak and Smartfren Telecom Tbk, you can compare the effects of market volatilities on PT Bukalapak and Smartfren Telecom 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 PT Bukalapak with a short position of Smartfren Telecom. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bukalapak and Smartfren Telecom.
Diversification Opportunities for PT Bukalapak and Smartfren Telecom
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BUKA and Smartfren is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding PT Bukalapak and Smartfren Telecom Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smartfren Telecom Tbk and PT Bukalapak 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 PT Bukalapak are associated (or correlated) with Smartfren Telecom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smartfren Telecom Tbk has no effect on the direction of PT Bukalapak i.e., PT Bukalapak and Smartfren Telecom go up and down completely randomly.
Pair Corralation between PT Bukalapak and Smartfren Telecom
Assuming the 90 days trading horizon PT Bukalapak is expected to generate 0.89 times more return on investment than Smartfren Telecom. However, PT Bukalapak is 1.12 times less risky than Smartfren Telecom. It trades about -0.05 of its potential returns per unit of risk. Smartfren Telecom Tbk is currently generating about -0.23 per unit of risk. If you would invest 12,500 in PT Bukalapak on September 2, 2024 and sell it today you would lose (300.00) from holding PT Bukalapak or give up 2.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bukalapak vs. Smartfren Telecom Tbk
Performance |
| Timeline |
| PT Bukalapak |
| Smartfren Telecom Tbk |
PT Bukalapak and Smartfren Telecom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bukalapak and Smartfren Telecom
The main advantage of trading using opposite PT Bukalapak and Smartfren Telecom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bukalapak position performs unexpectedly, Smartfren Telecom 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 Smartfren Telecom will offset losses from the drop in Smartfren Telecom's long position.| PT Bukalapak vs. GoTo Gojek Tokopedia | PT Bukalapak vs. Elang Mahkota Teknologi | PT Bukalapak vs. Bank Artos Indonesia | PT Bukalapak vs. Merdeka Copper Gold |
| Smartfren Telecom vs. Indosat Tbk | Smartfren Telecom vs. XL Axiata Tbk | Smartfren Telecom vs. Energi Mega Persada | Smartfren Telecom vs. Bakrie Brothers 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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