Correlation Between Citra Marga and Pyridam Farma
Can any of the company-specific risk be diversified away by investing in both Citra Marga and Pyridam Farma 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 Marga and Pyridam Farma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Citra Marga Nusaphala and Pyridam Farma Tbk, you can compare the effects of market volatilities on Citra Marga and Pyridam Farma 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 Marga with a short position of Pyridam Farma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Citra Marga and Pyridam Farma.
Diversification Opportunities for Citra Marga and Pyridam Farma
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Citra and Pyridam is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Citra Marga Nusaphala and Pyridam Farma Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pyridam Farma Tbk and Citra Marga 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 Marga Nusaphala are associated (or correlated) with Pyridam Farma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pyridam Farma Tbk has no effect on the direction of Citra Marga i.e., Citra Marga and Pyridam Farma go up and down completely randomly.
Pair Corralation between Citra Marga and Pyridam Farma
Assuming the 90 days trading horizon Citra Marga Nusaphala is expected to generate 0.1 times more return on investment than Pyridam Farma. However, Citra Marga Nusaphala is 10.25 times less risky than Pyridam Farma. It trades about 0.0 of its potential returns per unit of risk. Pyridam Farma Tbk is currently generating about -0.06 per unit of risk. If you would invest 143,500 in Citra Marga Nusaphala on August 30, 2024 and sell it today you would earn a total of 0.00 from holding Citra Marga Nusaphala or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Citra Marga Nusaphala vs. Pyridam Farma Tbk
Performance |
| Timeline |
| Citra Marga Nusaphala |
| Pyridam Farma Tbk |
Citra Marga and Pyridam Farma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Citra Marga and Pyridam Farma
The main advantage of trading using opposite Citra Marga and Pyridam Farma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Citra Marga position performs unexpectedly, Pyridam Farma 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 Pyridam Farma will offset losses from the drop in Pyridam Farma's long position.| Citra Marga vs. Berlian Laju Tanker | Citra Marga vs. Solusi Bangun Indonesia | Citra Marga vs. Kawasan Industri Jababeka | Citra Marga vs. Mnc Investama Tbk |
| Pyridam Farma vs. Indofarma Tbk | Pyridam Farma vs. Merck Tbk | Pyridam Farma vs. Tempo Scan Pacific | Pyridam Farma vs. Mustika Ratu 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 CEOs Directory module to screen CEOs from public companies around the world.
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