Correlation Between Dow Jones and PT Harapan
Can any of the company-specific risk be diversified away by investing in both Dow Jones and PT Harapan 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 Dow Jones and PT Harapan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dow Jones Industrial and PT Harapan Duta, you can compare the effects of market volatilities on Dow Jones and PT Harapan 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 Dow Jones with a short position of PT Harapan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and PT Harapan.
Diversification Opportunities for Dow Jones and PT Harapan
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dow and HOPE is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and PT Harapan Duta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Harapan Duta and Dow Jones 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 Dow Jones Industrial are associated (or correlated) with PT Harapan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Harapan Duta has no effect on the direction of Dow Jones i.e., Dow Jones and PT Harapan go up and down completely randomly.
Pair Corralation between Dow Jones and PT Harapan
Assuming the 90 days trading horizon Dow Jones is expected to generate 2.07 times less return on investment than PT Harapan. But when comparing it to its historical volatility, Dow Jones Industrial is 6.11 times less risky than PT Harapan. It trades about 0.16 of its potential returns per unit of risk. PT Harapan Duta is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,900 in PT Harapan Duta on September 1, 2024 and sell it today you would earn a total of 600.00 from holding PT Harapan Duta or generate 20.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.21% |
| Values | Daily Returns |
Dow Jones Industrial vs. PT Harapan Duta
Performance |
| Timeline |
Dow Jones and PT Harapan Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
PT Harapan Duta
Pair trading matchups for PT Harapan
Pair Trading with Dow Jones and PT Harapan
The main advantage of trading using opposite Dow Jones and PT Harapan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, PT Harapan 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 PT Harapan will offset losses from the drop in PT Harapan's long position.| Dow Jones vs. Catalyst Pharmaceuticals | Dow Jones vs. Sphere Entertainment Co | Dow Jones vs. National CineMedia | Dow Jones vs. Mink Therapeutics |
| PT Harapan vs. Ladangbaja Murni PT | PT Harapan vs. Berkah Beton Sadaya | PT Harapan vs. Cahayaputra Asa Keramik | PT Harapan vs. Diagnos Laboratorium Utama |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |