Correlation Between Enseval Putra and Dian Swastatika
Can any of the company-specific risk be diversified away by investing in both Enseval Putra and Dian Swastatika 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 Enseval Putra and Dian Swastatika into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enseval Putra Megatrading and Dian Swastatika Sentosa, you can compare the effects of market volatilities on Enseval Putra and Dian Swastatika 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 Enseval Putra with a short position of Dian Swastatika. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enseval Putra and Dian Swastatika.
Diversification Opportunities for Enseval Putra and Dian Swastatika
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Enseval and Dian is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Enseval Putra Megatrading and Dian Swastatika Sentosa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dian Swastatika Sentosa and Enseval Putra 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 Enseval Putra Megatrading are associated (or correlated) with Dian Swastatika. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dian Swastatika Sentosa has no effect on the direction of Enseval Putra i.e., Enseval Putra and Dian Swastatika go up and down completely randomly.
Pair Corralation between Enseval Putra and Dian Swastatika
Assuming the 90 days trading horizon Enseval Putra Megatrading is expected to under-perform the Dian Swastatika. But the stock apears to be less risky and, when comparing its historical volatility, Enseval Putra Megatrading is 2.09 times less risky than Dian Swastatika. The stock trades about -0.18 of its potential returns per unit of risk. The Dian Swastatika Sentosa is currently generating about 0.47 of returns per unit of risk over similar time horizon. If you would invest 3,677,500 in Dian Swastatika Sentosa on November 4, 2024 and sell it today you would earn a total of 810,000 from holding Dian Swastatika Sentosa or generate 22.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enseval Putra Megatrading vs. Dian Swastatika Sentosa
Performance |
| Timeline |
| Enseval Putra Megatrading |
| Dian Swastatika Sentosa |
Enseval Putra and Dian Swastatika Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enseval Putra and Dian Swastatika
The main advantage of trading using opposite Enseval Putra and Dian Swastatika positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enseval Putra position performs unexpectedly, Dian Swastatika 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 Dian Swastatika will offset losses from the drop in Dian Swastatika's long position.| Enseval Putra vs. Astra Graphia Tbk | Enseval Putra vs. Hexindo Adiperkasa Tbk | Enseval Putra vs. Lautan Luas Tbk | Enseval Putra vs. Citra Marga Nusaphala |
| Dian Swastatika vs. Resource Alam Indonesia | Dian Swastatika vs. J Resources Asia | Dian Swastatika vs. TBS Energi Utama | Dian Swastatika vs. Rukun Raharja 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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