Correlation Between Dharma Satya and Wahana Inti
Can any of the company-specific risk be diversified away by investing in both Dharma Satya and Wahana Inti 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 Wahana Inti 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 Wahana Inti MakmurTbk, you can compare the effects of market volatilities on Dharma Satya and Wahana Inti 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 Wahana Inti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dharma Satya and Wahana Inti.
Diversification Opportunities for Dharma Satya and Wahana Inti
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Dharma and Wahana is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Dharma Satya Nusantara and Wahana Inti MakmurTbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wahana Inti MakmurTbk 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 Wahana Inti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wahana Inti MakmurTbk has no effect on the direction of Dharma Satya i.e., Dharma Satya and Wahana Inti go up and down completely randomly.
Pair Corralation between Dharma Satya and Wahana Inti
Assuming the 90 days trading horizon Dharma Satya Nusantara is expected to generate 0.98 times more return on investment than Wahana Inti. However, Dharma Satya Nusantara is 1.02 times less risky than Wahana Inti. It trades about 0.16 of its potential returns per unit of risk. Wahana Inti MakmurTbk is currently generating about -0.07 per unit of risk. If you would invest 78,000 in Dharma Satya Nusantara on September 3, 2024 and sell it today you would earn a total of 35,500 from holding Dharma Satya Nusantara or generate 45.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dharma Satya Nusantara vs. Wahana Inti MakmurTbk
Performance |
| Timeline |
| Dharma Satya Nusantara |
| Wahana Inti MakmurTbk |
Dharma Satya and Wahana Inti Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dharma Satya and Wahana Inti
The main advantage of trading using opposite Dharma Satya and Wahana Inti positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dharma Satya position performs unexpectedly, Wahana Inti 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 Wahana Inti will offset losses from the drop in Wahana Inti's long position.| Dharma Satya vs. Salim Ivomas Pratama | Dharma Satya vs. Sawit Sumbermas Sarana | Dharma Satya vs. Austindo Nusantara Jaya | Dharma Satya vs. Eagle High Plantations |
| Wahana Inti vs. Dharma Satya Nusantara | Wahana Inti vs. Saratoga Investama Sedaya | Wahana Inti vs. Surya Esa Perkasa | Wahana Inti vs. Elang Mahkota Teknologi |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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