Correlation Between Cahayaputra Asa and Eastparc Hotel
Can any of the company-specific risk be diversified away by investing in both Cahayaputra Asa and Eastparc Hotel 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 Cahayaputra Asa and Eastparc Hotel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cahayaputra Asa Keramik and Eastparc Hotel Tbk, you can compare the effects of market volatilities on Cahayaputra Asa and Eastparc Hotel 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 Cahayaputra Asa with a short position of Eastparc Hotel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cahayaputra Asa and Eastparc Hotel.
Diversification Opportunities for Cahayaputra Asa and Eastparc Hotel
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cahayaputra and Eastparc is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Cahayaputra Asa Keramik and Eastparc Hotel Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastparc Hotel Tbk and Cahayaputra Asa 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 Cahayaputra Asa Keramik are associated (or correlated) with Eastparc Hotel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastparc Hotel Tbk has no effect on the direction of Cahayaputra Asa i.e., Cahayaputra Asa and Eastparc Hotel go up and down completely randomly.
Pair Corralation between Cahayaputra Asa and Eastparc Hotel
Assuming the 90 days trading horizon Cahayaputra Asa Keramik is expected to generate 1.01 times more return on investment than Eastparc Hotel. However, Cahayaputra Asa is 1.01 times more volatile than Eastparc Hotel Tbk. It trades about -0.03 of its potential returns per unit of risk. Eastparc Hotel Tbk is currently generating about -0.11 per unit of risk. If you would invest 15,800 in Cahayaputra Asa Keramik on August 24, 2024 and sell it today you would lose (400.00) from holding Cahayaputra Asa Keramik or give up 2.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Cahayaputra Asa Keramik vs. Eastparc Hotel Tbk
Performance |
| Timeline |
| Cahayaputra Asa Keramik |
| Eastparc Hotel Tbk |
Cahayaputra Asa and Eastparc Hotel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cahayaputra Asa and Eastparc Hotel
The main advantage of trading using opposite Cahayaputra Asa and Eastparc Hotel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cahayaputra Asa position performs unexpectedly, Eastparc Hotel 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 Eastparc Hotel will offset losses from the drop in Eastparc Hotel's long position.| Cahayaputra Asa vs. Gunawan Dianjaya Steel | Cahayaputra Asa vs. Yelooo Integra Datanet | Cahayaputra Asa vs. Arita Prima Indonesia | Cahayaputra Asa vs. Bekasi Asri Pemula |
| Eastparc Hotel vs. Hotel Fitra International | Eastparc Hotel vs. Jasa Armada Indonesia | Eastparc Hotel vs. Cahayaputra Asa Keramik | Eastparc Hotel vs. Campina Ice Cream |
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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