Correlation Between Eastparc Hotel and Indo Acidatama
Can any of the company-specific risk be diversified away by investing in both Eastparc Hotel and Indo Acidatama 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 Indo Acidatama 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 Indo Acidatama Tbk, you can compare the effects of market volatilities on Eastparc Hotel and Indo Acidatama 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 Indo Acidatama. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastparc Hotel and Indo Acidatama.
Diversification Opportunities for Eastparc Hotel and Indo Acidatama
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eastparc and Indo is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Eastparc Hotel Tbk and Indo Acidatama Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indo Acidatama Tbk 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 Indo Acidatama. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indo Acidatama Tbk has no effect on the direction of Eastparc Hotel i.e., Eastparc Hotel and Indo Acidatama go up and down completely randomly.
Pair Corralation between Eastparc Hotel and Indo Acidatama
Assuming the 90 days trading horizon Eastparc Hotel Tbk is expected to generate 1.05 times more return on investment than Indo Acidatama. However, Eastparc Hotel is 1.05 times more volatile than Indo Acidatama Tbk. It trades about 0.04 of its potential returns per unit of risk. Indo Acidatama Tbk is currently generating about 0.01 per unit of risk. If you would invest 8,162 in Eastparc Hotel Tbk on August 27, 2024 and sell it today you would earn a total of 2,638 from holding Eastparc Hotel Tbk or generate 32.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Eastparc Hotel Tbk vs. Indo Acidatama Tbk
Performance |
| Timeline |
| Eastparc Hotel Tbk |
| Indo Acidatama Tbk |
Eastparc Hotel and Indo Acidatama Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastparc Hotel and Indo Acidatama
The main advantage of trading using opposite Eastparc Hotel and Indo Acidatama positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastparc Hotel position performs unexpectedly, Indo Acidatama 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 Indo Acidatama will offset losses from the drop in Indo Acidatama's long position.| Eastparc Hotel vs. Menteng Heritage Realty | Eastparc Hotel vs. Hotel Fitra International | Eastparc Hotel vs. Jasa Armada Indonesia | Eastparc Hotel vs. Cahayaputra Asa Keramik |
| Indo Acidatama vs. PT Sreeya Sewu | Indo Acidatama vs. Trias Sentosa Tbk | Indo Acidatama vs. Slj Global Tbk | Indo Acidatama vs. Suparma Tbk |
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.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Stocks Directory Find actively traded stocks across global markets |