Correlation Between Garudafood Putra and Indointernet Tbk
Can any of the company-specific risk be diversified away by investing in both Garudafood Putra and Indointernet Tbk 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 Garudafood Putra and Indointernet Tbk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Garudafood Putra Putri and Indointernet Tbk PT, you can compare the effects of market volatilities on Garudafood Putra and Indointernet Tbk 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 Garudafood Putra with a short position of Indointernet Tbk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Garudafood Putra and Indointernet Tbk.
Diversification Opportunities for Garudafood Putra and Indointernet Tbk
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Garudafood and Indointernet is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Garudafood Putra Putri and Indointernet Tbk PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indointernet Tbk and Garudafood Putra 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 Garudafood Putra Putri are associated (or correlated) with Indointernet Tbk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indointernet Tbk has no effect on the direction of Garudafood Putra i.e., Garudafood Putra and Indointernet Tbk go up and down completely randomly.
Pair Corralation between Garudafood Putra and Indointernet Tbk
Assuming the 90 days trading horizon Garudafood Putra Putri is expected to under-perform the Indointernet Tbk. In addition to that, Garudafood Putra is 1.73 times more volatile than Indointernet Tbk PT. It trades about -0.08 of its total potential returns per unit of risk. Indointernet Tbk PT is currently generating about -0.12 per unit of volatility. If you would invest 414,000 in Indointernet Tbk PT on August 30, 2024 and sell it today you would lose (19,000) from holding Indointernet Tbk PT or give up 4.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Garudafood Putra Putri vs. Indointernet Tbk PT
Performance |
| Timeline |
| Garudafood Putra Putri |
| Indointernet Tbk |
Garudafood Putra and Indointernet Tbk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Garudafood Putra and Indointernet Tbk
The main advantage of trading using opposite Garudafood Putra and Indointernet Tbk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Garudafood Putra position performs unexpectedly, Indointernet Tbk 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 Indointernet Tbk will offset losses from the drop in Indointernet Tbk's long position.| Garudafood Putra vs. Sariguna Primatirta PT | Garudafood Putra vs. Ultra Jaya Milk | Garudafood Putra vs. Nippon Indosari Corpindo | Garudafood Putra vs. Kino Indonesia Tbk |
| Indointernet Tbk vs. DCI Indonesia Tbk | Indointernet Tbk vs. Digital Mediatama Maxima | Indointernet Tbk vs. Multipolar Technology Tbk | Indointernet Tbk vs. Bank Net Indonesia |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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