Correlation Between Dharma Satya and Garudafood Putra
Can any of the company-specific risk be diversified away by investing in both Dharma Satya and Garudafood Putra 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 Satya and Garudafood Putra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dharma Satya Nusantara and Garudafood Putra Putri, you can compare the effects of market volatilities on Dharma Satya and Garudafood Putra 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 Satya with a short position of Garudafood Putra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dharma Satya and Garudafood Putra.
Diversification Opportunities for Dharma Satya and Garudafood Putra
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dharma and Garudafood is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Dharma Satya Nusantara and Garudafood Putra Putri in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garudafood Putra Putri and Dharma Satya 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 Satya Nusantara are associated (or correlated) with Garudafood Putra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garudafood Putra Putri has no effect on the direction of Dharma Satya i.e., Dharma Satya and Garudafood Putra go up and down completely randomly.
Pair Corralation between Dharma Satya and Garudafood Putra
Assuming the 90 days trading horizon Dharma Satya Nusantara is expected to generate 2.21 times more return on investment than Garudafood Putra. However, Dharma Satya is 2.21 times more volatile than Garudafood Putra Putri. It trades about 0.1 of its potential returns per unit of risk. Garudafood Putra Putri is currently generating about -0.01 per unit of risk. If you would invest 57,532 in Dharma Satya Nusantara on September 12, 2024 and sell it today you would earn a total of 60,968 from holding Dharma Satya Nusantara or generate 105.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dharma Satya Nusantara vs. Garudafood Putra Putri
Performance |
| Timeline |
| Dharma Satya Nusantara |
| Garudafood Putra Putri |
Dharma Satya and Garudafood Putra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dharma Satya and Garudafood Putra
The main advantage of trading using opposite Dharma Satya and Garudafood Putra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dharma Satya position performs unexpectedly, Garudafood Putra 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 Garudafood Putra will offset losses from the drop in Garudafood Putra's long position.| Dharma Satya vs. Austindo Nusantara Jaya | Dharma Satya vs. Garudafood Putra Putri | Dharma Satya vs. Provident Agro Tbk | Dharma Satya vs. Sawit Sumbermas Sarana |
| Garudafood Putra vs. Austindo Nusantara Jaya | Garudafood Putra vs. Provident Agro Tbk | Garudafood Putra vs. Dharma Satya Nusantara | Garudafood Putra vs. Sawit Sumbermas Sarana |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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