Correlation Between Gozco Plantations and Sentul City
Can any of the company-specific risk be diversified away by investing in both Gozco Plantations and Sentul City 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 Gozco Plantations and Sentul City into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gozco Plantations Tbk and Sentul City Tbk, you can compare the effects of market volatilities on Gozco Plantations and Sentul City 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 Gozco Plantations with a short position of Sentul City. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gozco Plantations and Sentul City.
Diversification Opportunities for Gozco Plantations and Sentul City
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Gozco and Sentul is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Gozco Plantations Tbk and Sentul City Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sentul City Tbk and Gozco Plantations 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 Gozco Plantations Tbk are associated (or correlated) with Sentul City. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sentul City Tbk has no effect on the direction of Gozco Plantations i.e., Gozco Plantations and Sentul City go up and down completely randomly.
Pair Corralation between Gozco Plantations and Sentul City
Assuming the 90 days trading horizon Gozco Plantations Tbk is expected to generate 0.66 times more return on investment than Sentul City. However, Gozco Plantations Tbk is 1.51 times less risky than Sentul City. It trades about 0.01 of its potential returns per unit of risk. Sentul City Tbk is currently generating about -0.07 per unit of risk. If you would invest 10,000 in Gozco Plantations Tbk on August 31, 2024 and sell it today you would earn a total of 0.00 from holding Gozco Plantations Tbk or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gozco Plantations Tbk vs. Sentul City Tbk
Performance |
| Timeline |
| Gozco Plantations Tbk |
| Sentul City Tbk |
Gozco Plantations and Sentul City Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gozco Plantations and Sentul City
The main advantage of trading using opposite Gozco Plantations and Sentul City positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gozco Plantations position performs unexpectedly, Sentul City 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 Sentul City will offset losses from the drop in Sentul City's long position.| Gozco Plantations vs. Indofood Cbp Sukses | Gozco Plantations vs. Bank BRISyariah Tbk | Gozco Plantations vs. Mitra Pinasthika Mustika | Gozco Plantations vs. Jakarta Int Hotels |
| Sentul City vs. Alam Sutera Realty | Sentul City vs. Kawasan Industri Jababeka | Sentul City vs. Lippo Karawaci Tbk | Sentul City vs. Ciputra Development 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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