Correlation Between PT Bukalapak and Indosat Tbk
Can any of the company-specific risk be diversified away by investing in both PT Bukalapak and Indosat Tbk 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 Indosat Tbk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Bukalapak and Indosat Tbk, you can compare the effects of market volatilities on PT Bukalapak and Indosat Tbk 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 Indosat Tbk. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bukalapak and Indosat Tbk.
Diversification Opportunities for PT Bukalapak and Indosat Tbk
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between BUKA and Indosat is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding PT Bukalapak and Indosat Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indosat 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 Indosat Tbk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indosat Tbk has no effect on the direction of PT Bukalapak i.e., PT Bukalapak and Indosat Tbk go up and down completely randomly.
Pair Corralation between PT Bukalapak and Indosat Tbk
Assuming the 90 days trading horizon PT Bukalapak is expected to generate 0.4 times more return on investment than Indosat Tbk. However, PT Bukalapak is 2.53 times less risky than Indosat Tbk. It trades about 0.02 of its potential returns per unit of risk. Indosat Tbk is currently generating about -0.17 per unit of risk. If you would invest 12,100 in PT Bukalapak on August 30, 2024 and sell it today you would earn a total of 100.00 from holding PT Bukalapak or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Bukalapak vs. Indosat Tbk
Performance |
| Timeline |
| PT Bukalapak |
| Indosat Tbk |
PT Bukalapak and Indosat Tbk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bukalapak and Indosat Tbk
The main advantage of trading using opposite PT Bukalapak and Indosat Tbk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bukalapak position performs unexpectedly, Indosat Tbk 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 Indosat Tbk will offset losses from the drop in Indosat Tbk'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 |
| Indosat Tbk vs. Bank Artos Indonesia | Indosat Tbk vs. PT Bukalapak | Indosat Tbk vs. Sumber Alfaria Trijaya | Indosat Tbk vs. Merdeka Copper Gold |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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