Correlation Between PT Data and Garuda Metalindo
Can any of the company-specific risk be diversified away by investing in both PT Data and Garuda Metalindo 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 PT Data and Garuda Metalindo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Data Sinergitama and Garuda Metalindo Tbk, you can compare the effects of market volatilities on PT Data and Garuda Metalindo 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 PT Data with a short position of Garuda Metalindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Data and Garuda Metalindo.
Diversification Opportunities for PT Data and Garuda Metalindo
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ELIT and Garuda is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding PT Data Sinergitama and Garuda Metalindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garuda Metalindo Tbk and PT Data 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 PT Data Sinergitama are associated (or correlated) with Garuda Metalindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garuda Metalindo Tbk has no effect on the direction of PT Data i.e., PT Data and Garuda Metalindo go up and down completely randomly.
Pair Corralation between PT Data and Garuda Metalindo
Assuming the 90 days trading horizon PT Data is expected to generate 1.87 times less return on investment than Garuda Metalindo. In addition to that, PT Data is 1.81 times more volatile than Garuda Metalindo Tbk. It trades about 0.05 of its total potential returns per unit of risk. Garuda Metalindo Tbk is currently generating about 0.18 per unit of volatility. If you would invest 87,481 in Garuda Metalindo Tbk on September 3, 2024 and sell it today you would earn a total of 34,519 from holding Garuda Metalindo Tbk or generate 39.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Data Sinergitama vs. Garuda Metalindo Tbk
Performance |
| Timeline |
| PT Data Sinergitama |
| Garuda Metalindo Tbk |
PT Data and Garuda Metalindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Data and Garuda Metalindo
The main advantage of trading using opposite PT Data and Garuda Metalindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Data position performs unexpectedly, Garuda Metalindo 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 Garuda Metalindo will offset losses from the drop in Garuda Metalindo's long position.| PT Data vs. Indointernet Tbk PT | PT Data vs. Multipolar Technology Tbk | PT Data vs. Indosterling Technomedia Tbk | PT Data vs. PT Techno9 Indonesia |
| Garuda Metalindo vs. Intanwijaya Internasional Tbk | Garuda Metalindo vs. Champion Pacific Indonesia | Garuda Metalindo vs. Mitra Pinasthika Mustika | Garuda Metalindo vs. Jakarta Int Hotels |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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