Correlation Between Gajah Tunggal and Hotel Sahid
Can any of the company-specific risk be diversified away by investing in both Gajah Tunggal and Hotel Sahid 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 Gajah Tunggal and Hotel Sahid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gajah Tunggal Tbk and Hotel Sahid Jaya, you can compare the effects of market volatilities on Gajah Tunggal and Hotel Sahid 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 Gajah Tunggal with a short position of Hotel Sahid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gajah Tunggal and Hotel Sahid.
Diversification Opportunities for Gajah Tunggal and Hotel Sahid
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Gajah and Hotel is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Gajah Tunggal Tbk and Hotel Sahid Jaya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hotel Sahid Jaya and Gajah Tunggal 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 Gajah Tunggal Tbk are associated (or correlated) with Hotel Sahid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hotel Sahid Jaya has no effect on the direction of Gajah Tunggal i.e., Gajah Tunggal and Hotel Sahid go up and down completely randomly.
Pair Corralation between Gajah Tunggal and Hotel Sahid
Assuming the 90 days trading horizon Gajah Tunggal Tbk is expected to under-perform the Hotel Sahid. But the stock apears to be less risky and, when comparing its historical volatility, Gajah Tunggal Tbk is 1.05 times less risky than Hotel Sahid. The stock trades about -0.03 of its potential returns per unit of risk. The Hotel Sahid Jaya is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 94,500 in Hotel Sahid Jaya on August 27, 2024 and sell it today you would earn a total of 0.00 from holding Hotel Sahid Jaya or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gajah Tunggal Tbk vs. Hotel Sahid Jaya
Performance |
| Timeline |
| Gajah Tunggal Tbk |
| Hotel Sahid Jaya |
Gajah Tunggal and Hotel Sahid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gajah Tunggal and Hotel Sahid
The main advantage of trading using opposite Gajah Tunggal and Hotel Sahid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gajah Tunggal position performs unexpectedly, Hotel Sahid 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 Hotel Sahid will offset losses from the drop in Hotel Sahid's long position.| Gajah Tunggal vs. Perusahaan Perkebunan London | Gajah Tunggal vs. Solusi Bangun Indonesia | Gajah Tunggal vs. Ciputra Development Tbk | Gajah Tunggal vs. Global Mediacom Tbk |
| Hotel Sahid vs. Pembangunan Jaya Ancol | Hotel Sahid vs. Panorama Sentrawisata Tbk | Hotel Sahid vs. Sona Topas Tourism | Hotel Sahid vs. Millennium Pharmacon International |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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