Correlation Between Humpuss Intermoda and Lautan Luas
Can any of the company-specific risk be diversified away by investing in both Humpuss Intermoda and Lautan Luas 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 Humpuss Intermoda and Lautan Luas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Humpuss Intermoda Transportasi and Lautan Luas Tbk, you can compare the effects of market volatilities on Humpuss Intermoda and Lautan Luas 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 Humpuss Intermoda with a short position of Lautan Luas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Humpuss Intermoda and Lautan Luas.
Diversification Opportunities for Humpuss Intermoda and Lautan Luas
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Humpuss and Lautan is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Humpuss Intermoda Transportasi and Lautan Luas Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lautan Luas Tbk and Humpuss Intermoda 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 Humpuss Intermoda Transportasi are associated (or correlated) with Lautan Luas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lautan Luas Tbk has no effect on the direction of Humpuss Intermoda i.e., Humpuss Intermoda and Lautan Luas go up and down completely randomly.
Pair Corralation between Humpuss Intermoda and Lautan Luas
Assuming the 90 days trading horizon Humpuss Intermoda Transportasi is expected to generate 3.14 times more return on investment than Lautan Luas. However, Humpuss Intermoda is 3.14 times more volatile than Lautan Luas Tbk. It trades about 0.02 of its potential returns per unit of risk. Lautan Luas Tbk is currently generating about -0.02 per unit of risk. If you would invest 41,800 in Humpuss Intermoda Transportasi on September 14, 2024 and sell it today you would earn a total of 200.00 from holding Humpuss Intermoda Transportasi or generate 0.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Humpuss Intermoda Transportasi vs. Lautan Luas Tbk
Performance |
| Timeline |
| Humpuss Intermoda |
| Lautan Luas Tbk |
Humpuss Intermoda and Lautan Luas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Humpuss Intermoda and Lautan Luas
The main advantage of trading using opposite Humpuss Intermoda and Lautan Luas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Humpuss Intermoda position performs unexpectedly, Lautan Luas 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 Lautan Luas will offset losses from the drop in Lautan Luas' long position.| Humpuss Intermoda vs. Harum Energy Tbk | Humpuss Intermoda vs. Delta Dunia Makmur | Humpuss Intermoda vs. Adi Sarana Armada | Humpuss Intermoda vs. Elang Mahkota Teknologi |
| Lautan Luas vs. Kedaung Indah Can | Lautan Luas vs. Kabelindo Murni Tbk | Lautan Luas vs. Champion Pacific Indonesia | Lautan Luas vs. Bhuwanatala Indah Permai |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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