Correlation Between Perdana Gapura and Nusa Konstruksi
Can any of the company-specific risk be diversified away by investing in both Perdana Gapura and Nusa Konstruksi 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 Perdana Gapura and Nusa Konstruksi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Perdana Gapura Prima and Nusa Konstruksi Enjiniring, you can compare the effects of market volatilities on Perdana Gapura and Nusa Konstruksi 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 Perdana Gapura with a short position of Nusa Konstruksi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perdana Gapura and Nusa Konstruksi.
Diversification Opportunities for Perdana Gapura and Nusa Konstruksi
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Perdana and Nusa is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Perdana Gapura Prima and Nusa Konstruksi Enjiniring in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nusa Konstruksi Enji and Perdana Gapura 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 Perdana Gapura Prima are associated (or correlated) with Nusa Konstruksi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nusa Konstruksi Enji has no effect on the direction of Perdana Gapura i.e., Perdana Gapura and Nusa Konstruksi go up and down completely randomly.
Pair Corralation between Perdana Gapura and Nusa Konstruksi
Assuming the 90 days trading horizon Perdana Gapura Prima is expected to under-perform the Nusa Konstruksi. In addition to that, Perdana Gapura is 1.8 times more volatile than Nusa Konstruksi Enjiniring. It trades about -0.16 of its total potential returns per unit of risk. Nusa Konstruksi Enjiniring is currently generating about -0.28 per unit of volatility. If you would invest 8,600 in Nusa Konstruksi Enjiniring on August 27, 2024 and sell it today you would lose (400.00) from holding Nusa Konstruksi Enjiniring or give up 4.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Perdana Gapura Prima vs. Nusa Konstruksi Enjiniring
Performance |
| Timeline |
| Perdana Gapura Prima |
| Nusa Konstruksi Enji |
Perdana Gapura and Nusa Konstruksi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perdana Gapura and Nusa Konstruksi
The main advantage of trading using opposite Perdana Gapura and Nusa Konstruksi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perdana Gapura position performs unexpectedly, Nusa Konstruksi 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 Nusa Konstruksi will offset losses from the drop in Nusa Konstruksi's long position.| Perdana Gapura vs. Bukit Darmo Property | Perdana Gapura vs. Intiland Development Tbk | Perdana Gapura vs. Bekasi Asri Pemula | Perdana Gapura vs. Duta Anggada Realty |
| Nusa Konstruksi vs. Sentul City Tbk | Nusa Konstruksi vs. Gozco Plantations Tbk | Nusa Konstruksi vs. Bukit Darmo Property | Nusa Konstruksi vs. Total Bangun Persada |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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