Correlation Between Bumi Resources and Sepeda Bersama
Can any of the company-specific risk be diversified away by investing in both Bumi Resources and Sepeda Bersama 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 Resources and Sepeda Bersama into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bumi Resources Tbk and Sepeda Bersama Indonesia, you can compare the effects of market volatilities on Bumi Resources and Sepeda Bersama 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 Resources with a short position of Sepeda Bersama. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bumi Resources and Sepeda Bersama.
Diversification Opportunities for Bumi Resources and Sepeda Bersama
-0.87 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bumi and Sepeda is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Bumi Resources Tbk and Sepeda Bersama Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sepeda Bersama Indonesia and Bumi Resources 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 Resources Tbk are associated (or correlated) with Sepeda Bersama. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sepeda Bersama Indonesia has no effect on the direction of Bumi Resources i.e., Bumi Resources and Sepeda Bersama go up and down completely randomly.
Pair Corralation between Bumi Resources and Sepeda Bersama
Assuming the 90 days trading horizon Bumi Resources is expected to generate 2.71 times less return on investment than Sepeda Bersama. In addition to that, Bumi Resources is 1.0 times more volatile than Sepeda Bersama Indonesia. It trades about 0.04 of its total potential returns per unit of risk. Sepeda Bersama Indonesia is currently generating about 0.1 per unit of volatility. If you would invest 18,672 in Sepeda Bersama Indonesia on September 2, 2024 and sell it today you would earn a total of 32,828 from holding Sepeda Bersama Indonesia or generate 175.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bumi Resources Tbk vs. Sepeda Bersama Indonesia
Performance |
| Timeline |
| Bumi Resources Tbk |
| Sepeda Bersama Indonesia |
Bumi Resources and Sepeda Bersama Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bumi Resources and Sepeda Bersama
The main advantage of trading using opposite Bumi Resources and Sepeda Bersama positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bumi Resources position performs unexpectedly, Sepeda Bersama 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 Sepeda Bersama will offset losses from the drop in Sepeda Bersama's long position.| Bumi Resources vs. Aneka Tambang Persero | Bumi Resources vs. Timah Persero Tbk | Bumi Resources vs. Vale Indonesia Tbk | Bumi Resources vs. Energi Mega Persada |
| Sepeda Bersama vs. Autopedia Sukses Lestari | Sepeda Bersama vs. Champ Resto Indonesia | Sepeda Bersama vs. GTS Internasional Tbk | Sepeda Bersama vs. Avia Avian PT |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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