Correlation Between Cisadane Sawit and Wahana Inti
Can any of the company-specific risk be diversified away by investing in both Cisadane Sawit and Wahana Inti 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 Cisadane Sawit and Wahana Inti into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cisadane Sawit Raya and Wahana Inti MakmurTbk, you can compare the effects of market volatilities on Cisadane Sawit and Wahana Inti 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 Cisadane Sawit with a short position of Wahana Inti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cisadane Sawit and Wahana Inti.
Diversification Opportunities for Cisadane Sawit and Wahana Inti
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Cisadane and Wahana is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Cisadane Sawit Raya and Wahana Inti MakmurTbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wahana Inti MakmurTbk and Cisadane Sawit 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 Cisadane Sawit Raya are associated (or correlated) with Wahana Inti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wahana Inti MakmurTbk has no effect on the direction of Cisadane Sawit i.e., Cisadane Sawit and Wahana Inti go up and down completely randomly.
Pair Corralation between Cisadane Sawit and Wahana Inti
Assuming the 90 days trading horizon Cisadane Sawit is expected to generate 1.59 times less return on investment than Wahana Inti. But when comparing it to its historical volatility, Cisadane Sawit Raya is 2.58 times less risky than Wahana Inti. It trades about 0.06 of its potential returns per unit of risk. Wahana Inti MakmurTbk is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 7,700 in Wahana Inti MakmurTbk on September 12, 2024 and sell it today you would earn a total of 1,200 from holding Wahana Inti MakmurTbk or generate 15.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cisadane Sawit Raya vs. Wahana Inti MakmurTbk
Performance |
| Timeline |
| Cisadane Sawit Raya |
| Wahana Inti MakmurTbk |
Cisadane Sawit and Wahana Inti Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cisadane Sawit and Wahana Inti
The main advantage of trading using opposite Cisadane Sawit and Wahana Inti positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cisadane Sawit position performs unexpectedly, Wahana Inti 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 Wahana Inti will offset losses from the drop in Wahana Inti's long position.| Cisadane Sawit vs. Mahkota Group Tbk | Cisadane Sawit vs. Palma Serasih PT | Cisadane Sawit vs. Diamond Food Indonesia | Cisadane Sawit vs. Saraswanti Anugerah Makmur |
| Wahana Inti vs. Mahkota Group Tbk | Wahana Inti vs. Palma Serasih PT | Wahana Inti vs. Cisadane Sawit Raya | Wahana Inti vs. Diamond Food Indonesia |
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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