Correlation Between PT Data and Indorama Synthetics
Can any of the company-specific risk be diversified away by investing in both PT Data and Indorama Synthetics 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 Indorama Synthetics 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 Indorama Synthetics Tbk, you can compare the effects of market volatilities on PT Data and Indorama Synthetics 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 Indorama Synthetics. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Data and Indorama Synthetics.
Diversification Opportunities for PT Data and Indorama Synthetics
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ELIT and Indorama is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding PT Data Sinergitama and Indorama Synthetics Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indorama Synthetics 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 Indorama Synthetics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indorama Synthetics Tbk has no effect on the direction of PT Data i.e., PT Data and Indorama Synthetics go up and down completely randomly.
Pair Corralation between PT Data and Indorama Synthetics
Assuming the 90 days trading horizon PT Data Sinergitama is expected to generate 1.54 times more return on investment than Indorama Synthetics. However, PT Data is 1.54 times more volatile than Indorama Synthetics Tbk. It trades about 0.04 of its potential returns per unit of risk. Indorama Synthetics Tbk is currently generating about -0.2 per unit of risk. If you would invest 10,800 in PT Data Sinergitama on September 3, 2024 and sell it today you would earn a total of 400.00 from holding PT Data Sinergitama or generate 3.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Data Sinergitama vs. Indorama Synthetics Tbk
Performance |
| Timeline |
| PT Data Sinergitama |
| Indorama Synthetics Tbk |
PT Data and Indorama Synthetics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Data and Indorama Synthetics
The main advantage of trading using opposite PT Data and Indorama Synthetics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Data position performs unexpectedly, Indorama Synthetics 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 Indorama Synthetics will offset losses from the drop in Indorama Synthetics' 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 |
| Indorama Synthetics vs. Mitra Pinasthika Mustika | Indorama Synthetics vs. Jakarta Int Hotels | Indorama Synthetics vs. Asuransi Harta Aman | Indorama Synthetics vs. Indosterling Technomedia 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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