Correlation Between Elang Mahkota and GoTo Gojek
Can any of the company-specific risk be diversified away by investing in both Elang Mahkota and GoTo Gojek 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 Elang Mahkota and GoTo Gojek into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elang Mahkota Teknologi and GoTo Gojek Tokopedia, you can compare the effects of market volatilities on Elang Mahkota and GoTo Gojek 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 Elang Mahkota with a short position of GoTo Gojek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elang Mahkota and GoTo Gojek.
Diversification Opportunities for Elang Mahkota and GoTo Gojek
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Elang and GoTo is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Elang Mahkota Teknologi and GoTo Gojek Tokopedia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GoTo Gojek Tokopedia and Elang Mahkota 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 Elang Mahkota Teknologi are associated (or correlated) with GoTo Gojek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GoTo Gojek Tokopedia has no effect on the direction of Elang Mahkota i.e., Elang Mahkota and GoTo Gojek go up and down completely randomly.
Pair Corralation between Elang Mahkota and GoTo Gojek
Assuming the 90 days trading horizon Elang Mahkota is expected to generate 1.75 times less return on investment than GoTo Gojek. In addition to that, Elang Mahkota is 1.2 times more volatile than GoTo Gojek Tokopedia. It trades about 0.14 of its total potential returns per unit of risk. GoTo Gojek Tokopedia is currently generating about 0.29 per unit of volatility. If you would invest 7,100 in GoTo Gojek Tokopedia on November 3, 2024 and sell it today you would earn a total of 1,200 from holding GoTo Gojek Tokopedia or generate 16.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elang Mahkota Teknologi vs. GoTo Gojek Tokopedia
Performance |
| Timeline |
| Elang Mahkota Teknologi |
| GoTo Gojek Tokopedia |
Elang Mahkota and GoTo Gojek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elang Mahkota and GoTo Gojek
The main advantage of trading using opposite Elang Mahkota and GoTo Gojek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elang Mahkota position performs unexpectedly, GoTo Gojek 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 GoTo Gojek will offset losses from the drop in GoTo Gojek's long position.| Elang Mahkota vs. Bank Artos Indonesia | Elang Mahkota vs. PT Bukalapak | Elang Mahkota vs. Sumber Alfaria Trijaya | Elang Mahkota vs. Merdeka Copper Gold |
| GoTo Gojek vs. PT Bukalapak | GoTo Gojek vs. Bank Artos Indonesia | GoTo Gojek vs. Elang Mahkota Teknologi | GoTo Gojek vs. Adaro Minerals Indonesia |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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