Correlation Between GM and Jaya Swarasa
Can any of the company-specific risk be diversified away by investing in both GM and Jaya Swarasa 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 GM and Jaya Swarasa into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between General Motors and Jaya Swarasa Agung, you can compare the effects of market volatilities on GM and Jaya Swarasa 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 GM with a short position of Jaya Swarasa. Check out your portfolio center. Please also check ongoing floating volatility patterns of GM and Jaya Swarasa.
Diversification Opportunities for GM and Jaya Swarasa
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GM and Jaya is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding General Motors and Jaya Swarasa Agung in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jaya Swarasa Agung and GM 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 General Motors are associated (or correlated) with Jaya Swarasa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jaya Swarasa Agung has no effect on the direction of GM i.e., GM and Jaya Swarasa go up and down completely randomly.
Pair Corralation between GM and Jaya Swarasa
Allowing for the 90-day total investment horizon General Motors is expected to generate 1.66 times more return on investment than Jaya Swarasa. However, GM is 1.66 times more volatile than Jaya Swarasa Agung. It trades about 0.13 of its potential returns per unit of risk. Jaya Swarasa Agung is currently generating about -0.41 per unit of risk. If you would invest 5,154 in General Motors on August 30, 2024 and sell it today you would earn a total of 396.00 from holding General Motors or generate 7.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
General Motors vs. Jaya Swarasa Agung
Performance |
| Timeline |
| General Motors |
| Jaya Swarasa Agung |
GM and Jaya Swarasa Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GM and Jaya Swarasa
The main advantage of trading using opposite GM and Jaya Swarasa positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GM position performs unexpectedly, Jaya Swarasa 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 Jaya Swarasa will offset losses from the drop in Jaya Swarasa's long position.The idea behind General Motors and Jaya Swarasa Agung pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Jaya Swarasa vs. Sentra Food Indonesia | Jaya Swarasa vs. Buyung Poetra Sembada | Jaya Swarasa vs. Garudafood Putra Putri | Jaya Swarasa vs. Campina Ice Cream |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |