Correlation Between Dharma Polimetal and Personel Alih
Can any of the company-specific risk be diversified away by investing in both Dharma Polimetal and Personel Alih 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 Dharma Polimetal and Personel Alih into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dharma Polimetal Tbk and Personel Alih Daya, you can compare the effects of market volatilities on Dharma Polimetal and Personel Alih 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 Dharma Polimetal with a short position of Personel Alih. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dharma Polimetal and Personel Alih.
Diversification Opportunities for Dharma Polimetal and Personel Alih
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dharma and Personel is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Dharma Polimetal Tbk and Personel Alih Daya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Personel Alih Daya and Dharma Polimetal 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 Dharma Polimetal Tbk are associated (or correlated) with Personel Alih. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Personel Alih Daya has no effect on the direction of Dharma Polimetal i.e., Dharma Polimetal and Personel Alih go up and down completely randomly.
Pair Corralation between Dharma Polimetal and Personel Alih
Assuming the 90 days trading horizon Dharma Polimetal Tbk is expected to generate 0.25 times more return on investment than Personel Alih. However, Dharma Polimetal Tbk is 3.92 times less risky than Personel Alih. It trades about -0.22 of its potential returns per unit of risk. Personel Alih Daya is currently generating about -0.09 per unit of risk. If you would invest 109,000 in Dharma Polimetal Tbk on August 30, 2024 and sell it today you would lose (8,000) from holding Dharma Polimetal Tbk or give up 7.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dharma Polimetal Tbk vs. Personel Alih Daya
Performance |
| Timeline |
| Dharma Polimetal Tbk |
| Personel Alih Daya |
Dharma Polimetal and Personel Alih Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dharma Polimetal and Personel Alih
The main advantage of trading using opposite Dharma Polimetal and Personel Alih positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dharma Polimetal position performs unexpectedly, Personel Alih 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 Personel Alih will offset losses from the drop in Personel Alih's long position.| Dharma Polimetal vs. Triputra Agro Persada | Dharma Polimetal vs. Autopedia Sukses Lestari | Dharma Polimetal vs. Cisarua Mountain Dairy | Dharma Polimetal vs. Surya Esa Perkasa |
| Personel Alih vs. PT Surya Pertiwi | Personel Alih vs. Satria Mega Kencana | Personel Alih vs. Multifiling Mitra Indonesia | Personel Alih vs. Royal Prima PT |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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