Correlation Between Gunawan Dianjaya and Wijaya Karya
Can any of the company-specific risk be diversified away by investing in both Gunawan Dianjaya and Wijaya Karya 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 Gunawan Dianjaya and Wijaya Karya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gunawan Dianjaya Steel and Wijaya Karya Beton, you can compare the effects of market volatilities on Gunawan Dianjaya and Wijaya Karya 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 Gunawan Dianjaya with a short position of Wijaya Karya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gunawan Dianjaya and Wijaya Karya.
Diversification Opportunities for Gunawan Dianjaya and Wijaya Karya
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gunawan and Wijaya is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Gunawan Dianjaya Steel and Wijaya Karya Beton in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wijaya Karya Beton and Gunawan Dianjaya 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 Gunawan Dianjaya Steel are associated (or correlated) with Wijaya Karya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wijaya Karya Beton has no effect on the direction of Gunawan Dianjaya i.e., Gunawan Dianjaya and Wijaya Karya go up and down completely randomly.
Pair Corralation between Gunawan Dianjaya and Wijaya Karya
Assuming the 90 days trading horizon Gunawan Dianjaya Steel is expected to generate 1.31 times more return on investment than Wijaya Karya. However, Gunawan Dianjaya is 1.31 times more volatile than Wijaya Karya Beton. It trades about -0.09 of its potential returns per unit of risk. Wijaya Karya Beton is currently generating about -0.21 per unit of risk. If you would invest 12,167 in Gunawan Dianjaya Steel on November 2, 2024 and sell it today you would lose (3,067) from holding Gunawan Dianjaya Steel or give up 25.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.0% |
| Values | Daily Returns |
Gunawan Dianjaya Steel vs. Wijaya Karya Beton
Performance |
| Timeline |
| Gunawan Dianjaya Steel |
| Wijaya Karya Beton |
Gunawan Dianjaya and Wijaya Karya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gunawan Dianjaya and Wijaya Karya
The main advantage of trading using opposite Gunawan Dianjaya and Wijaya Karya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gunawan Dianjaya position performs unexpectedly, Wijaya Karya 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 Wijaya Karya will offset losses from the drop in Wijaya Karya's long position.| Gunawan Dianjaya vs. Betonjaya Manunggal Tbk | Gunawan Dianjaya vs. Lotte Chemical Titan | Gunawan Dianjaya vs. Indopoly Swakarsa Industry | Gunawan Dianjaya vs. Saranacentral Bajatama Tbk |
| Wijaya Karya vs. Waskita Karya Persero | Wijaya Karya vs. Waskita Beton Precast | Wijaya Karya vs. Pembangunan Perumahan PT | Wijaya Karya vs. Wijaya Karya Beton |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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