Correlation Between Enseval Putra and Tempo Scan
Can any of the company-specific risk be diversified away by investing in both Enseval Putra and Tempo Scan 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 Tempo Scan 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 Tempo Scan Pacific, you can compare the effects of market volatilities on Enseval Putra and Tempo Scan 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 Tempo Scan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enseval Putra and Tempo Scan.
Diversification Opportunities for Enseval Putra and Tempo Scan
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Enseval and Tempo is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Enseval Putra Megatrading and Tempo Scan Pacific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tempo Scan Pacific 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 Tempo Scan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tempo Scan Pacific has no effect on the direction of Enseval Putra i.e., Enseval Putra and Tempo Scan go up and down completely randomly.
Pair Corralation between Enseval Putra and Tempo Scan
Assuming the 90 days trading horizon Enseval Putra is expected to generate 15.14 times less return on investment than Tempo Scan. But when comparing it to its historical volatility, Enseval Putra Megatrading is 1.86 times less risky than Tempo Scan. It trades about 0.01 of its potential returns per unit of risk. Tempo Scan Pacific is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 118,255 in Tempo Scan Pacific on August 29, 2024 and sell it today you would earn a total of 135,745 from holding Tempo Scan Pacific or generate 114.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Enseval Putra Megatrading vs. Tempo Scan Pacific
Performance |
| Timeline |
| Enseval Putra Megatrading |
| Tempo Scan Pacific |
Enseval Putra and Tempo Scan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Enseval Putra and Tempo Scan
The main advantage of trading using opposite Enseval Putra and Tempo Scan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enseval Putra position performs unexpectedly, Tempo Scan 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 Tempo Scan will offset losses from the drop in Tempo Scan'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 |
| Tempo Scan vs. Merdeka Copper Gold | Tempo Scan vs. Tower Bersama Infrastructure | Tempo Scan vs. Erajaya Swasembada Tbk | Tempo Scan vs. Surya Citra Media |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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