Correlation Between Geoprima Solusi and Integra Indocabinet
Can any of the company-specific risk be diversified away by investing in both Geoprima Solusi and Integra Indocabinet 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 Geoprima Solusi and Integra Indocabinet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Geoprima Solusi Tbk and Integra Indocabinet Tbk, you can compare the effects of market volatilities on Geoprima Solusi and Integra Indocabinet 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 Geoprima Solusi with a short position of Integra Indocabinet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Geoprima Solusi and Integra Indocabinet.
Diversification Opportunities for Geoprima Solusi and Integra Indocabinet
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Geoprima and Integra is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Geoprima Solusi Tbk and Integra Indocabinet Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integra Indocabinet Tbk and Geoprima Solusi 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 Geoprima Solusi Tbk are associated (or correlated) with Integra Indocabinet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integra Indocabinet Tbk has no effect on the direction of Geoprima Solusi i.e., Geoprima Solusi and Integra Indocabinet go up and down completely randomly.
Pair Corralation between Geoprima Solusi and Integra Indocabinet
Assuming the 90 days trading horizon Geoprima Solusi Tbk is expected to generate 2.71 times more return on investment than Integra Indocabinet. However, Geoprima Solusi is 2.71 times more volatile than Integra Indocabinet Tbk. It trades about 0.49 of its potential returns per unit of risk. Integra Indocabinet Tbk is currently generating about 0.09 per unit of risk. If you would invest 10,700 in Geoprima Solusi Tbk on August 30, 2024 and sell it today you would earn a total of 24,900 from holding Geoprima Solusi Tbk or generate 232.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Geoprima Solusi Tbk vs. Integra Indocabinet Tbk
Performance |
| Timeline |
| Geoprima Solusi Tbk |
| Integra Indocabinet Tbk |
Geoprima Solusi and Integra Indocabinet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Geoprima Solusi and Integra Indocabinet
The main advantage of trading using opposite Geoprima Solusi and Integra Indocabinet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Geoprima Solusi position performs unexpectedly, Integra Indocabinet 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 Integra Indocabinet will offset losses from the drop in Integra Indocabinet's long position.| Geoprima Solusi vs. Mandala Multifinance Tbk | Geoprima Solusi vs. PT Techno9 Indonesia | Geoprima Solusi vs. Bank BRISyariah Tbk | Geoprima Solusi vs. Bumi Resources Tbk |
| Integra Indocabinet vs. Buyung Poetra Sembada | Integra Indocabinet vs. Erajaya Swasembada Tbk | Integra Indocabinet vs. Sariguna Primatirta PT | Integra Indocabinet vs. Puradelta Lestari PT |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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