Correlation Between Enseval Putra and PT Boston
Can any of the company-specific risk be diversified away by investing in both Enseval Putra and PT Boston 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 PT Boston 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 PT Boston Furniture, you can compare the effects of market volatilities on Enseval Putra and PT Boston 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 PT Boston. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enseval Putra and PT Boston.
Diversification Opportunities for Enseval Putra and PT Boston
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Enseval and SOFA is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Enseval Putra Megatrading and PT Boston Furniture in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Boston Furniture 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 PT Boston. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Boston Furniture has no effect on the direction of Enseval Putra i.e., Enseval Putra and PT Boston go up and down completely randomly.
Pair Corralation between Enseval Putra and PT Boston
Assuming the 90 days trading horizon Enseval Putra is expected to generate 20.94 times less return on investment than PT Boston. But when comparing it to its historical volatility, Enseval Putra Megatrading is 5.01 times less risky than PT Boston. It trades about 0.06 of its potential returns per unit of risk. PT Boston Furniture is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 1,400 in PT Boston Furniture on September 3, 2024 and sell it today you would earn a total of 2,300 from holding PT Boston Furniture or generate 164.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enseval Putra Megatrading vs. PT Boston Furniture
Performance |
| Timeline |
| Enseval Putra Megatrading |
| PT Boston Furniture |
Enseval Putra and PT Boston Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enseval Putra and PT Boston
The main advantage of trading using opposite Enseval Putra and PT Boston positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enseval Putra position performs unexpectedly, PT Boston 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 PT Boston will offset losses from the drop in PT Boston's long position.| Enseval Putra vs. Surya Citra Media | Enseval Putra vs. Sawit Sumbermas Sarana | Enseval Putra vs. Mitra Pinasthika Mustika | Enseval Putra vs. Jakarta Int Hotels |
| PT Boston vs. Mitra Pinasthika Mustika | PT Boston vs. Jakarta Int Hotels | PT Boston vs. Indosat Tbk | PT Boston vs. Inocycle Technology 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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