Correlation Between Eratex Djaja and PT Cahayasakti
Can any of the company-specific risk be diversified away by investing in both Eratex Djaja and PT Cahayasakti 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 Cahayasakti 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 Cahayasakti Investindo, you can compare the effects of market volatilities on Eratex Djaja and PT Cahayasakti 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 Cahayasakti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eratex Djaja and PT Cahayasakti.
Diversification Opportunities for Eratex Djaja and PT Cahayasakti
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Eratex and CSIS is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Eratex Djaja Tbk and PT Cahayasakti Investindo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Cahayasakti Investindo 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 Cahayasakti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Cahayasakti Investindo has no effect on the direction of Eratex Djaja i.e., Eratex Djaja and PT Cahayasakti go up and down completely randomly.
Pair Corralation between Eratex Djaja and PT Cahayasakti
Assuming the 90 days trading horizon Eratex Djaja Tbk is expected to generate 3.51 times more return on investment than PT Cahayasakti. However, Eratex Djaja is 3.51 times more volatile than PT Cahayasakti Investindo. It trades about 0.12 of its potential returns per unit of risk. PT Cahayasakti Investindo is currently generating about -0.02 per unit of risk. If you would invest 9,000 in Eratex Djaja Tbk on August 30, 2024 and sell it today you would earn a total of 1,600 from holding Eratex Djaja Tbk or generate 17.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eratex Djaja Tbk vs. PT Cahayasakti Investindo
Performance |
| Timeline |
| Eratex Djaja Tbk |
| PT Cahayasakti Investindo |
Eratex Djaja and PT Cahayasakti Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eratex Djaja and PT Cahayasakti
The main advantage of trading using opposite Eratex Djaja and PT Cahayasakti positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eratex Djaja position performs unexpectedly, PT Cahayasakti 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 Cahayasakti will offset losses from the drop in PT Cahayasakti's long position.| Eratex Djaja vs. Pembangunan Jaya Ancol | Eratex Djaja vs. Panorama Sentrawisata Tbk | Eratex Djaja vs. Millennium Pharmacon International | Eratex Djaja vs. Tempo Inti Media |
| PT Cahayasakti vs. Bumi Citra Permai | PT Cahayasakti vs. Bekasi Asri Pemula | PT Cahayasakti vs. Borneo Olah Sarana | PT Cahayasakti vs. Indonesia Pondasi Raya |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |