Correlation Between Citra Borneo and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Citra Borneo and Dow Jones 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 Citra Borneo and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citra Borneo Utama and Dow Jones Industrial, you can compare the effects of market volatilities on Citra Borneo and Dow Jones 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 Citra Borneo with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citra Borneo and Dow Jones.
Diversification Opportunities for Citra Borneo and Dow Jones
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Citra and Dow is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Citra Borneo Utama and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Citra Borneo 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 Citra Borneo Utama are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Citra Borneo i.e., Citra Borneo and Dow Jones go up and down completely randomly.
Pair Corralation between Citra Borneo and Dow Jones
Assuming the 90 days trading horizon Citra Borneo Utama is expected to under-perform the Dow Jones. In addition to that, Citra Borneo is 2.71 times more volatile than Dow Jones Industrial. It trades about -0.17 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.22 per unit of volatility. If you would invest 4,238,757 in Dow Jones Industrial on August 27, 2024 and sell it today you would earn a total of 190,894 from holding Dow Jones Industrial or generate 4.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citra Borneo Utama vs. Dow Jones Industrial
Performance |
| Timeline |
Citra Borneo and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Citra Borneo Utama
Pair trading matchups for Citra Borneo
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Citra Borneo and Dow Jones
The main advantage of trading using opposite Citra Borneo and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citra Borneo position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Citra Borneo vs. Dharma Satya Nusantara | Citra Borneo vs. Saratoga Investama Sedaya | Citra Borneo vs. Surya Esa Perkasa | Citra Borneo vs. Elang Mahkota Teknologi |
| Dow Jones vs. Meiwu Technology Co | Dow Jones vs. 17 Education Technology | Dow Jones vs. 51Talk Online Education | Dow Jones vs. Afya |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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