Correlation Between Puradelta Lestari and Triputra Agro
Can any of the company-specific risk be diversified away by investing in both Puradelta Lestari and Triputra Agro 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 Puradelta Lestari and Triputra Agro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Puradelta Lestari PT and Triputra Agro Persada, you can compare the effects of market volatilities on Puradelta Lestari and Triputra Agro 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 Puradelta Lestari with a short position of Triputra Agro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Puradelta Lestari and Triputra Agro.
Diversification Opportunities for Puradelta Lestari and Triputra Agro
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Puradelta and Triputra is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding Puradelta Lestari PT and Triputra Agro Persada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Triputra Agro Persada and Puradelta Lestari 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 Puradelta Lestari PT are associated (or correlated) with Triputra Agro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Triputra Agro Persada has no effect on the direction of Puradelta Lestari i.e., Puradelta Lestari and Triputra Agro go up and down completely randomly.
Pair Corralation between Puradelta Lestari and Triputra Agro
Assuming the 90 days trading horizon Puradelta Lestari PT is expected to generate 0.28 times more return on investment than Triputra Agro. However, Puradelta Lestari PT is 3.61 times less risky than Triputra Agro. It trades about -0.12 of its potential returns per unit of risk. Triputra Agro Persada is currently generating about -0.09 per unit of risk. If you would invest 16,200 in Puradelta Lestari PT on August 29, 2024 and sell it today you would lose (300.00) from holding Puradelta Lestari PT or give up 1.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Puradelta Lestari PT vs. Triputra Agro Persada
Performance |
| Timeline |
| Puradelta Lestari |
| Triputra Agro Persada |
Puradelta Lestari and Triputra Agro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Puradelta Lestari and Triputra Agro
The main advantage of trading using opposite Puradelta Lestari and Triputra Agro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Puradelta Lestari position performs unexpectedly, Triputra Agro 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 Triputra Agro will offset losses from the drop in Triputra Agro's long position.| Puradelta Lestari vs. Bakrie Brothers Tbk | Puradelta Lestari vs. Bakrie Sumatera Plantations | Puradelta Lestari vs. Energi Mega Persada | Puradelta Lestari vs. Darma Henwa Tbk |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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