Correlation Between Bakrieland Development and Sariguna Primatirta
Can any of the company-specific risk be diversified away by investing in both Bakrieland Development and Sariguna Primatirta 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 Bakrieland Development and Sariguna Primatirta into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bakrieland Development Tbk and Sariguna Primatirta PT, you can compare the effects of market volatilities on Bakrieland Development and Sariguna Primatirta 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 Bakrieland Development with a short position of Sariguna Primatirta. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bakrieland Development and Sariguna Primatirta.
Diversification Opportunities for Bakrieland Development and Sariguna Primatirta
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Bakrieland and Sariguna is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Bakrieland Development Tbk and Sariguna Primatirta PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sariguna Primatirta and Bakrieland Development 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 Bakrieland Development Tbk are associated (or correlated) with Sariguna Primatirta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sariguna Primatirta has no effect on the direction of Bakrieland Development i.e., Bakrieland Development and Sariguna Primatirta go up and down completely randomly.
Pair Corralation between Bakrieland Development and Sariguna Primatirta
Assuming the 90 days trading horizon Bakrieland Development Tbk is expected to under-perform the Sariguna Primatirta. In addition to that, Bakrieland Development is 2.33 times more volatile than Sariguna Primatirta PT. It trades about -0.07 of its total potential returns per unit of risk. Sariguna Primatirta PT is currently generating about 0.1 per unit of volatility. If you would invest 66,239 in Sariguna Primatirta PT on September 1, 2024 and sell it today you would earn a total of 52,761 from holding Sariguna Primatirta PT or generate 79.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.61% |
| Values | Daily Returns |
Bakrieland Development Tbk vs. Sariguna Primatirta PT
Performance |
| Timeline |
| Bakrieland Development |
| Sariguna Primatirta |
Bakrieland Development and Sariguna Primatirta Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bakrieland Development and Sariguna Primatirta
The main advantage of trading using opposite Bakrieland Development and Sariguna Primatirta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bakrieland Development position performs unexpectedly, Sariguna Primatirta 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 Sariguna Primatirta will offset losses from the drop in Sariguna Primatirta's long position.| Bakrieland Development vs. Lippo Cikarang Tbk | Bakrieland Development vs. Lippo Karawaci Tbk | Bakrieland Development vs. Mitra Pinasthika Mustika | Bakrieland Development vs. Jakarta Int Hotels |
| Sariguna Primatirta vs. Buyung Poetra Sembada | Sariguna Primatirta vs. Sido Muncul PT | Sariguna Primatirta vs. Mayora Indah Tbk | Sariguna Primatirta vs. Integra Indocabinet 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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