Correlation Between Equity Development and Bekasi Fajar
Can any of the company-specific risk be diversified away by investing in both Equity Development and Bekasi Fajar 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 Equity Development and Bekasi Fajar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Equity Development Investment and Bekasi Fajar Industrial, you can compare the effects of market volatilities on Equity Development and Bekasi Fajar 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 Equity Development with a short position of Bekasi Fajar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Equity Development and Bekasi Fajar.
Diversification Opportunities for Equity Development and Bekasi Fajar
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Equity and Bekasi is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Equity Development Investment and Bekasi Fajar Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bekasi Fajar Industrial and Equity Development 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 Equity Development Investment are associated (or correlated) with Bekasi Fajar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bekasi Fajar Industrial has no effect on the direction of Equity Development i.e., Equity Development and Bekasi Fajar go up and down completely randomly.
Pair Corralation between Equity Development and Bekasi Fajar
Assuming the 90 days trading horizon Equity Development Investment is expected to generate 1.15 times more return on investment than Bekasi Fajar. However, Equity Development is 1.15 times more volatile than Bekasi Fajar Industrial. It trades about 0.07 of its potential returns per unit of risk. Bekasi Fajar Industrial is currently generating about 0.01 per unit of risk. If you would invest 5,000 in Equity Development Investment on September 3, 2024 and sell it today you would earn a total of 1,000.00 from holding Equity Development Investment or generate 20.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Equity Development Investment vs. Bekasi Fajar Industrial
Performance |
| Timeline |
| Equity Development |
| Bekasi Fajar Industrial |
Equity Development and Bekasi Fajar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Equity Development and Bekasi Fajar
The main advantage of trading using opposite Equity Development and Bekasi Fajar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Equity Development position performs unexpectedly, Bekasi Fajar 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 Bekasi Fajar will offset losses from the drop in Bekasi Fajar's long position.| Equity Development vs. Paninvest Tbk | Equity Development vs. Mitra Pinasthika Mustika | Equity Development vs. Jakarta Int Hotels | Equity Development vs. Asuransi Harta Aman |
| Bekasi Fajar vs. Mitra Pinasthika Mustika | Bekasi Fajar vs. Jakarta Int Hotels | Bekasi Fajar vs. Asuransi Harta Aman | Bekasi Fajar vs. Indosterling Technomedia Tbk |
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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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