Correlation Between Campina Ice and Hero Supermarket
Can any of the company-specific risk be diversified away by investing in both Campina Ice and Hero Supermarket 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 Campina Ice and Hero Supermarket into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Campina Ice Cream and Hero Supermarket Tbk, you can compare the effects of market volatilities on Campina Ice and Hero Supermarket 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 Campina Ice with a short position of Hero Supermarket. Check out your portfolio center. Please also check ongoing floating volatility patterns of Campina Ice and Hero Supermarket.
Diversification Opportunities for Campina Ice and Hero Supermarket
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Campina and Hero is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Campina Ice Cream and Hero Supermarket Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hero Supermarket Tbk and Campina Ice 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 Campina Ice Cream are associated (or correlated) with Hero Supermarket. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hero Supermarket Tbk has no effect on the direction of Campina Ice i.e., Campina Ice and Hero Supermarket go up and down completely randomly.
Pair Corralation between Campina Ice and Hero Supermarket
Assuming the 90 days trading horizon Campina Ice Cream is expected to generate 0.92 times more return on investment than Hero Supermarket. However, Campina Ice Cream is 1.09 times less risky than Hero Supermarket. It trades about -0.09 of its potential returns per unit of risk. Hero Supermarket Tbk is currently generating about -0.41 per unit of risk. If you would invest 26,800 in Campina Ice Cream on September 4, 2024 and sell it today you would lose (1,000.00) from holding Campina Ice Cream or give up 3.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Campina Ice Cream vs. Hero Supermarket Tbk
Performance |
| Timeline |
| Campina Ice Cream |
| Hero Supermarket Tbk |
Campina Ice and Hero Supermarket Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Campina Ice and Hero Supermarket
The main advantage of trading using opposite Campina Ice and Hero Supermarket positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Campina Ice position performs unexpectedly, Hero Supermarket 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 Hero Supermarket will offset losses from the drop in Hero Supermarket's long position.| Campina Ice vs. Sariguna Primatirta PT | Campina Ice vs. Garudafood Putra Putri | Campina Ice vs. Buyung Poetra Sembada | Campina Ice vs. Integra Indocabinet Tbk |
| Hero Supermarket vs. Fast Food Indonesia | Hero Supermarket vs. Enseval Putra Megatrading | Hero Supermarket vs. Matahari Putra Prima | Hero Supermarket vs. Hexindo Adiperkasa 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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