Correlation Between Indointernet Tbk and Garudafood Putra
Can any of the company-specific risk be diversified away by investing in both Indointernet Tbk 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 Indointernet Tbk and Garudafood Putra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Indointernet Tbk PT and Garudafood Putra Putri, you can compare the effects of market volatilities on Indointernet Tbk 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 Indointernet Tbk with a short position of Garudafood Putra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indointernet Tbk and Garudafood Putra.
Diversification Opportunities for Indointernet Tbk and Garudafood Putra
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Indointernet and Garudafood is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Indointernet Tbk PT 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 Indointernet Tbk 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 Indointernet Tbk PT 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 Indointernet Tbk i.e., Indointernet Tbk and Garudafood Putra go up and down completely randomly.
Pair Corralation between Indointernet Tbk and Garudafood Putra
Assuming the 90 days trading horizon Indointernet Tbk PT is expected to generate 0.58 times more return on investment than Garudafood Putra. However, Indointernet Tbk PT is 1.73 times less risky than Garudafood Putra. It trades about -0.12 of its potential returns per unit of risk. Garudafood Putra Putri is currently generating about -0.08 per unit of risk. If you would invest 414,000 in Indointernet Tbk PT on August 30, 2024 and sell it today you would lose (19,000) from holding Indointernet Tbk PT or give up 4.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Indointernet Tbk PT vs. Garudafood Putra Putri
Performance |
| Timeline |
| Indointernet Tbk |
| Garudafood Putra Putri |
Indointernet Tbk and Garudafood Putra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indointernet Tbk and Garudafood Putra
The main advantage of trading using opposite Indointernet Tbk and Garudafood Putra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indointernet Tbk 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.| Indointernet Tbk vs. DCI Indonesia Tbk | Indointernet Tbk vs. Digital Mediatama Maxima | Indointernet Tbk vs. Multipolar Technology Tbk | Indointernet Tbk vs. Bank Net Indonesia |
| Garudafood Putra vs. Sariguna Primatirta PT | Garudafood Putra vs. Ultra Jaya Milk | Garudafood Putra vs. Nippon Indosari Corpindo | Garudafood Putra vs. Kino Indonesia 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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