Correlation Between PT Gudang and Western Digital
Can any of the company-specific risk be diversified away by investing in both PT Gudang and Western Digital 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 PT Gudang and Western Digital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Gudang Garam and Western Digital, you can compare the effects of market volatilities on PT Gudang and Western Digital 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 PT Gudang with a short position of Western Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Gudang and Western Digital.
Diversification Opportunities for PT Gudang and Western Digital
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GGNPF and Western is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding PT Gudang Garam and Western Digital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Digital and PT Gudang 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 PT Gudang Garam are associated (or correlated) with Western Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Digital has no effect on the direction of PT Gudang i.e., PT Gudang and Western Digital go up and down completely randomly.
Pair Corralation between PT Gudang and Western Digital
Assuming the 90 days horizon PT Gudang Garam is expected to under-perform the Western Digital. In addition to that, PT Gudang is 1.17 times more volatile than Western Digital. It trades about -0.01 of its total potential returns per unit of risk. Western Digital is currently generating about 0.08 per unit of volatility. If you would invest 3,064 in Western Digital on September 12, 2024 and sell it today you would earn a total of 3,818 from holding Western Digital or generate 124.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
PT Gudang Garam vs. Western Digital
Performance |
| Timeline |
| PT Gudang Garam |
| Western Digital |
PT Gudang and Western Digital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Gudang and Western Digital
The main advantage of trading using opposite PT Gudang and Western Digital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Gudang position performs unexpectedly, Western Digital 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 Western Digital will offset losses from the drop in Western Digital's long position.| PT Gudang vs. Old Republic International | PT Gudang vs. MGIC Investment Corp | PT Gudang vs. Marfrig Global Foods | PT Gudang vs. Philip Morris International |
| Western Digital vs. NetApp Inc | Western Digital vs. Logitech International SA | Western Digital vs. HP Inc | Western Digital vs. Dell Technologies |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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