Correlation Between Garudafood Putra and Hero Supermarket
Can any of the company-specific risk be diversified away by investing in both Garudafood Putra and Hero Supermarket 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 Hero Supermarket 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 Hero Supermarket Tbk, you can compare the effects of market volatilities on Garudafood Putra and Hero Supermarket 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 Hero Supermarket. Check out your portfolio center. Please also check ongoing floating volatility patterns of Garudafood Putra and Hero Supermarket.
Diversification Opportunities for Garudafood Putra and Hero Supermarket
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Garudafood and Hero is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Garudafood Putra Putri and Hero Supermarket Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hero Supermarket 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 Hero Supermarket. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hero Supermarket Tbk has no effect on the direction of Garudafood Putra i.e., Garudafood Putra and Hero Supermarket go up and down completely randomly.
Pair Corralation between Garudafood Putra and Hero Supermarket
Assuming the 90 days trading horizon Garudafood Putra Putri is expected to generate 0.51 times more return on investment than Hero Supermarket. However, Garudafood Putra Putri is 1.94 times less risky than Hero Supermarket. It trades about -0.02 of its potential returns per unit of risk. Hero Supermarket Tbk is currently generating about -0.06 per unit of risk. If you would invest 47,526 in Garudafood Putra Putri on September 12, 2024 and sell it today you would lose (7,726) from holding Garudafood Putra Putri or give up 16.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Garudafood Putra Putri vs. Hero Supermarket Tbk
Performance |
| Timeline |
| Garudafood Putra Putri |
| Hero Supermarket Tbk |
Garudafood Putra and Hero Supermarket Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Garudafood Putra and Hero Supermarket
The main advantage of trading using opposite Garudafood Putra and Hero Supermarket positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Garudafood Putra position performs unexpectedly, Hero Supermarket 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 Hero Supermarket will offset losses from the drop in Hero Supermarket's long position.| Garudafood Putra vs. Austindo Nusantara Jaya | Garudafood Putra vs. Provident Agro Tbk | Garudafood Putra vs. Dharma Satya Nusantara | Garudafood Putra vs. Sawit Sumbermas Sarana |
| Hero Supermarket vs. Austindo Nusantara Jaya | Hero Supermarket vs. Garudafood Putra Putri | Hero Supermarket vs. Provident Agro Tbk | Hero Supermarket vs. Dharma Satya Nusantara |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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