Correlation Between Hero Supermarket and Tera Data
Can any of the company-specific risk be diversified away by investing in both Hero Supermarket and Tera Data 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 Hero Supermarket and Tera Data into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hero Supermarket Tbk and Tera Data Indonusa, you can compare the effects of market volatilities on Hero Supermarket and Tera Data 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 Hero Supermarket with a short position of Tera Data. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hero Supermarket and Tera Data.
Diversification Opportunities for Hero Supermarket and Tera Data
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hero and Tera is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Hero Supermarket Tbk and Tera Data Indonusa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tera Data Indonusa and Hero Supermarket 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 Hero Supermarket Tbk are associated (or correlated) with Tera Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tera Data Indonusa has no effect on the direction of Hero Supermarket i.e., Hero Supermarket and Tera Data go up and down completely randomly.
Pair Corralation between Hero Supermarket and Tera Data
Assuming the 90 days trading horizon Hero Supermarket Tbk is expected to under-perform the Tera Data. But the stock apears to be less risky and, when comparing its historical volatility, Hero Supermarket Tbk is 1.45 times less risky than Tera Data. The stock trades about -0.09 of its potential returns per unit of risk. The Tera Data Indonusa is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 12,372 in Tera Data Indonusa on September 2, 2024 and sell it today you would lose (172.00) from holding Tera Data Indonusa or give up 1.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hero Supermarket Tbk vs. Tera Data Indonusa
Performance |
| Timeline |
| Hero Supermarket Tbk |
| Tera Data Indonusa |
Hero Supermarket and Tera Data Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hero Supermarket and Tera Data
The main advantage of trading using opposite Hero Supermarket and Tera Data positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hero Supermarket position performs unexpectedly, Tera Data 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 Tera Data will offset losses from the drop in Tera Data's long position.| Hero Supermarket vs. Fast Food Indonesia | Hero Supermarket vs. Enseval Putra Megatrading | Hero Supermarket vs. Matahari Putra Prima | Hero Supermarket vs. Hexindo Adiperkasa 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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