Correlation Between Citra Putra and Delta Djakarta
Can any of the company-specific risk be diversified away by investing in both Citra Putra and Delta Djakarta 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 Delta Djakarta 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 Delta Djakarta Tbk, you can compare the effects of market volatilities on Citra Putra and Delta Djakarta 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 Delta Djakarta. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citra Putra and Delta Djakarta.
Diversification Opportunities for Citra Putra and Delta Djakarta
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Citra and Delta is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Citra Putra Realty and Delta Djakarta Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Delta Djakarta Tbk 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 Delta Djakarta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Delta Djakarta Tbk has no effect on the direction of Citra Putra i.e., Citra Putra and Delta Djakarta go up and down completely randomly.
Pair Corralation between Citra Putra and Delta Djakarta
Assuming the 90 days trading horizon Citra Putra Realty is expected to generate 3.64 times more return on investment than Delta Djakarta. However, Citra Putra is 3.64 times more volatile than Delta Djakarta Tbk. It trades about 0.01 of its potential returns per unit of risk. Delta Djakarta Tbk is currently generating about -0.13 per unit of risk. If you would invest 28,200 in Citra Putra Realty on August 28, 2024 and sell it today you would lose (4,000) from holding Citra Putra Realty or give up 14.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citra Putra Realty vs. Delta Djakarta Tbk
Performance |
| Timeline |
| Citra Putra Realty |
| Delta Djakarta Tbk |
Citra Putra and Delta Djakarta Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citra Putra and Delta Djakarta
The main advantage of trading using opposite Citra Putra and Delta Djakarta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citra Putra position performs unexpectedly, Delta Djakarta 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 Delta Djakarta will offset losses from the drop in Delta Djakarta's long position.| Citra Putra vs. Jasa Armada Indonesia | Citra Putra vs. Cahayaputra Asa Keramik | Citra Putra 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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