Correlation Between Sariguna Primatirta and Integra Indocabinet
Can any of the company-specific risk be diversified away by investing in both Sariguna Primatirta and Integra Indocabinet 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 Sariguna Primatirta and Integra Indocabinet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sariguna Primatirta PT and Integra Indocabinet Tbk, you can compare the effects of market volatilities on Sariguna Primatirta and Integra Indocabinet 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 Sariguna Primatirta with a short position of Integra Indocabinet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sariguna Primatirta and Integra Indocabinet.
Diversification Opportunities for Sariguna Primatirta and Integra Indocabinet
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sariguna and Integra is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Sariguna Primatirta PT and Integra Indocabinet Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integra Indocabinet Tbk and Sariguna Primatirta 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 Sariguna Primatirta PT are associated (or correlated) with Integra Indocabinet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integra Indocabinet Tbk has no effect on the direction of Sariguna Primatirta i.e., Sariguna Primatirta and Integra Indocabinet go up and down completely randomly.
Pair Corralation between Sariguna Primatirta and Integra Indocabinet
Assuming the 90 days trading horizon Sariguna Primatirta PT is expected to generate 0.63 times more return on investment than Integra Indocabinet. However, Sariguna Primatirta PT is 1.58 times less risky than Integra Indocabinet. It trades about -0.12 of its potential returns per unit of risk. Integra Indocabinet Tbk is currently generating about -0.21 per unit of risk. If you would invest 128,500 in Sariguna Primatirta PT on August 25, 2024 and sell it today you would lose (5,000) from holding Sariguna Primatirta PT or give up 3.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Sariguna Primatirta PT vs. Integra Indocabinet Tbk
Performance |
| Timeline |
| Sariguna Primatirta |
| Integra Indocabinet Tbk |
Sariguna Primatirta and Integra Indocabinet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sariguna Primatirta and Integra Indocabinet
The main advantage of trading using opposite Sariguna Primatirta and Integra Indocabinet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sariguna Primatirta position performs unexpectedly, Integra Indocabinet 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 Integra Indocabinet will offset losses from the drop in Integra Indocabinet's long position.| Sariguna Primatirta vs. Charoen Pokphand Indonesia | Sariguna Primatirta vs. Kalbe Farma Tbk | Sariguna Primatirta vs. Indofood Cbp Sukses | Sariguna Primatirta vs. Akr Corporindo Tbk |
| Integra Indocabinet vs. Buyung Poetra Sembada | Integra Indocabinet vs. Erajaya Swasembada Tbk | Integra Indocabinet vs. Sariguna Primatirta PT | Integra Indocabinet vs. Puradelta Lestari PT |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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