Correlation Between Citra Putra and Cita Mineral
Can any of the company-specific risk be diversified away by investing in both Citra Putra and Cita Mineral 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 Putra and Cita Mineral into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citra Putra Realty and Cita Mineral Investindo, you can compare the effects of market volatilities on Citra Putra and Cita Mineral 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 Putra with a short position of Cita Mineral. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citra Putra and Cita Mineral.
Diversification Opportunities for Citra Putra and Cita Mineral
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Citra and Cita is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Citra Putra Realty and Cita Mineral Investindo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cita Mineral Investindo and Citra Putra 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 Putra Realty are associated (or correlated) with Cita Mineral. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cita Mineral Investindo has no effect on the direction of Citra Putra i.e., Citra Putra and Cita Mineral go up and down completely randomly.
Pair Corralation between Citra Putra and Cita Mineral
Assuming the 90 days trading horizon Citra Putra Realty is expected to generate 1.16 times more return on investment than Cita Mineral. However, Citra Putra is 1.16 times more volatile than Cita Mineral Investindo. It trades about 0.02 of its potential returns per unit of risk. Cita Mineral Investindo is currently generating about 0.02 per unit of risk. If you would invest 44,800 in Citra Putra Realty on November 5, 2024 and sell it today you would earn a total of 1,200 from holding Citra Putra Realty or generate 2.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Citra Putra Realty vs. Cita Mineral Investindo
Performance |
| Timeline |
| Citra Putra Realty |
| Cita Mineral Investindo |
Citra Putra and Cita Mineral Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citra Putra and Cita Mineral
The main advantage of trading using opposite Citra Putra and Cita Mineral positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citra Putra position performs unexpectedly, Cita Mineral 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 Cita Mineral will offset losses from the drop in Cita Mineral's long position.| Citra Putra vs. Surya Permata Andalan | Citra Putra vs. Hotel Sahid Jaya | Citra Putra vs. Arthavest Tbk | Citra Putra vs. Jakarta Int Hotels |
| Cita Mineral vs. Citatah Tbk | Cita Mineral vs. Indo Kordsa Tbk | Cita Mineral vs. Central Omega Resources | Cita Mineral vs. Betonjaya Manunggal 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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