Correlation Between Ciputra Development and Sentul City
Can any of the company-specific risk be diversified away by investing in both Ciputra Development and Sentul City 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 Ciputra Development and Sentul City into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ciputra Development Tbk and Sentul City Tbk, you can compare the effects of market volatilities on Ciputra Development and Sentul City 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 Ciputra Development with a short position of Sentul City. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ciputra Development and Sentul City.
Diversification Opportunities for Ciputra Development and Sentul City
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ciputra and Sentul is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Ciputra Development Tbk and Sentul City Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sentul City Tbk and Ciputra Development 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 Ciputra Development Tbk are associated (or correlated) with Sentul City. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sentul City Tbk has no effect on the direction of Ciputra Development i.e., Ciputra Development and Sentul City go up and down completely randomly.
Pair Corralation between Ciputra Development and Sentul City
Assuming the 90 days trading horizon Ciputra Development Tbk is expected to under-perform the Sentul City. In addition to that, Ciputra Development is 1.15 times more volatile than Sentul City Tbk. It trades about -0.36 of its total potential returns per unit of risk. Sentul City Tbk is currently generating about -0.33 per unit of volatility. If you would invest 4,600 in Sentul City Tbk on August 24, 2024 and sell it today you would lose (800.00) from holding Sentul City Tbk or give up 17.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ciputra Development Tbk vs. Sentul City Tbk
Performance |
| Timeline |
| Ciputra Development Tbk |
| Sentul City Tbk |
Ciputra Development and Sentul City Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ciputra Development and Sentul City
The main advantage of trading using opposite Ciputra Development and Sentul City positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ciputra Development position performs unexpectedly, Sentul City 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 Sentul City will offset losses from the drop in Sentul City's long position.| Ciputra Development vs. Summarecon Agung Tbk | Ciputra Development vs. Bumi Serpong Damai | Ciputra Development vs. Adhi Karya Persero | Ciputra Development vs. Wijaya Karya Beton |
| Sentul City vs. Alam Sutera Realty | Sentul City vs. Kawasan Industri Jababeka | Sentul City vs. Lippo Karawaci Tbk | Sentul City vs. Ciputra Development 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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