Correlation Between Eratex Djaja and PT Century
Can any of the company-specific risk be diversified away by investing in both Eratex Djaja and PT Century 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 Eratex Djaja and PT Century into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eratex Djaja Tbk and PT Century Textile, you can compare the effects of market volatilities on Eratex Djaja and PT Century 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 Eratex Djaja with a short position of PT Century. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eratex Djaja and PT Century.
Diversification Opportunities for Eratex Djaja and PT Century
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Eratex and CNTX is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Eratex Djaja Tbk and PT Century Textile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Century Textile and Eratex Djaja 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 Eratex Djaja Tbk are associated (or correlated) with PT Century. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Century Textile has no effect on the direction of Eratex Djaja i.e., Eratex Djaja and PT Century go up and down completely randomly.
Pair Corralation between Eratex Djaja and PT Century
If you would invest 9,200 in Eratex Djaja Tbk on August 29, 2024 and sell it today you would earn a total of 1,600 from holding Eratex Djaja Tbk or generate 17.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Eratex Djaja Tbk vs. PT Century Textile
Performance |
| Timeline |
| Eratex Djaja Tbk |
| PT Century Textile |
Eratex Djaja and PT Century Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eratex Djaja and PT Century
The main advantage of trading using opposite Eratex Djaja and PT Century positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eratex Djaja position performs unexpectedly, PT Century 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 Century will offset losses from the drop in PT Century's long position.| Eratex Djaja vs. Ever Shine Textile | Eratex Djaja vs. PT Century Textile | Eratex Djaja vs. Argo Pantes Tbk | Eratex Djaja vs. Primarindo Asia Infrastructure |
| PT Century vs. Eratex Djaja Tbk | PT Century vs. Ever Shine Textile | PT Century vs. Argo Pantes Tbk | PT Century vs. Primarindo Asia Infrastructure |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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