Correlation Between Eastparc Hotel and Citra Putra
Can any of the company-specific risk be diversified away by investing in both Eastparc Hotel and Citra 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 Eastparc Hotel and Citra Putra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eastparc Hotel Tbk and Citra Putra Realty, you can compare the effects of market volatilities on Eastparc Hotel and Citra 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 Eastparc Hotel with a short position of Citra Putra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastparc Hotel and Citra Putra.
Diversification Opportunities for Eastparc Hotel and Citra Putra
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Eastparc and Citra is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Eastparc Hotel Tbk and Citra Putra Realty in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citra Putra Realty and Eastparc Hotel 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 Eastparc Hotel Tbk are associated (or correlated) with Citra Putra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citra Putra Realty has no effect on the direction of Eastparc Hotel i.e., Eastparc Hotel and Citra Putra go up and down completely randomly.
Pair Corralation between Eastparc Hotel and Citra Putra
Assuming the 90 days trading horizon Eastparc Hotel Tbk is expected to under-perform the Citra Putra. But the stock apears to be less risky and, when comparing its historical volatility, Eastparc Hotel Tbk is 2.94 times less risky than Citra Putra. The stock trades about -0.24 of its potential returns per unit of risk. The Citra Putra Realty is currently generating about 0.49 of returns per unit of risk over similar time horizon. If you would invest 43,000 in Citra Putra Realty on November 28, 2024 and sell it today you would earn a total of 19,000 from holding Citra Putra Realty or generate 44.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eastparc Hotel Tbk vs. Citra Putra Realty
Performance |
| Timeline |
| Eastparc Hotel Tbk |
| Citra Putra Realty |
Eastparc Hotel and Citra Putra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastparc Hotel and Citra Putra
The main advantage of trading using opposite Eastparc Hotel and Citra Putra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastparc Hotel position performs unexpectedly, Citra 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 Citra Putra will offset losses from the drop in Citra Putra's long position.| Eastparc Hotel vs. Menteng Heritage Realty | Eastparc Hotel vs. Jasa Armada Indonesia | Eastparc Hotel vs. Cahayaputra Asa Keramik | Eastparc Hotel vs. Campina Ice Cream |
| Citra Putra vs. PT Dafam Property | Citra Putra vs. Surya Permata Andalan | Citra Putra vs. Eastparc Hotel Tbk | Citra Putra vs. Bintang Oto Global |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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