Correlation Between Fortune Mate and Puradelta Lestari
Can any of the company-specific risk be diversified away by investing in both Fortune Mate and Puradelta Lestari 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 Fortune Mate and Puradelta Lestari into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fortune Mate Indonesia and Puradelta Lestari PT, you can compare the effects of market volatilities on Fortune Mate and Puradelta Lestari 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 Fortune Mate with a short position of Puradelta Lestari. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fortune Mate and Puradelta Lestari.
Diversification Opportunities for Fortune Mate and Puradelta Lestari
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fortune and Puradelta is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Fortune Mate Indonesia and Puradelta Lestari PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Puradelta Lestari and Fortune Mate 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 Fortune Mate Indonesia are associated (or correlated) with Puradelta Lestari. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Puradelta Lestari has no effect on the direction of Fortune Mate i.e., Fortune Mate and Puradelta Lestari go up and down completely randomly.
Pair Corralation between Fortune Mate and Puradelta Lestari
Assuming the 90 days trading horizon Fortune Mate Indonesia is expected to generate 10.36 times more return on investment than Puradelta Lestari. However, Fortune Mate is 10.36 times more volatile than Puradelta Lestari PT. It trades about 0.28 of its potential returns per unit of risk. Puradelta Lestari PT is currently generating about -0.02 per unit of risk. If you would invest 24,800 in Fortune Mate Indonesia on August 27, 2024 and sell it today you would earn a total of 29,700 from holding Fortune Mate Indonesia or generate 119.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fortune Mate Indonesia vs. Puradelta Lestari PT
Performance |
| Timeline |
| Fortune Mate Indonesia |
| Puradelta Lestari |
Fortune Mate and Puradelta Lestari Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fortune Mate and Puradelta Lestari
The main advantage of trading using opposite Fortune Mate and Puradelta Lestari positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fortune Mate position performs unexpectedly, Puradelta Lestari 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 Puradelta Lestari will offset losses from the drop in Puradelta Lestari's long position.| Fortune Mate vs. Puradelta Lestari PT | Fortune Mate vs. Lippo Cikarang Tbk | Fortune Mate vs. Bekasi Asri Pemula |
| Puradelta Lestari vs. Pakuwon Jati Tbk | Puradelta Lestari vs. Sido Muncul PT | Puradelta Lestari vs. Bekasi Fajar Industrial | Puradelta Lestari vs. Bank Pembangunan Timur |
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 Stocks Directory module to find actively traded stocks across global markets.
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