Correlation Between Harum Energy and PT Pelayaran
Can any of the company-specific risk be diversified away by investing in both Harum Energy and PT Pelayaran 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 Harum Energy and PT Pelayaran into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Harum Energy Tbk and PT Pelayaran Tamarin, you can compare the effects of market volatilities on Harum Energy and PT Pelayaran 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 Harum Energy with a short position of PT Pelayaran. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harum Energy and PT Pelayaran.
Diversification Opportunities for Harum Energy and PT Pelayaran
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Harum and TAMU is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Harum Energy Tbk and PT Pelayaran Tamarin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Pelayaran Tamarin and Harum Energy 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 Harum Energy Tbk are associated (or correlated) with PT Pelayaran. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Pelayaran Tamarin has no effect on the direction of Harum Energy i.e., Harum Energy and PT Pelayaran go up and down completely randomly.
Pair Corralation between Harum Energy and PT Pelayaran
Assuming the 90 days trading horizon Harum Energy Tbk is expected to under-perform the PT Pelayaran. But the stock apears to be less risky and, when comparing its historical volatility, Harum Energy Tbk is 2.56 times less risky than PT Pelayaran. The stock trades about -0.18 of its potential returns per unit of risk. The PT Pelayaran Tamarin is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 1,500 in PT Pelayaran Tamarin on August 31, 2024 and sell it today you would lose (100.00) from holding PT Pelayaran Tamarin or give up 6.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Harum Energy Tbk vs. PT Pelayaran Tamarin
Performance |
| Timeline |
| Harum Energy Tbk |
| PT Pelayaran Tamarin |
Harum Energy and PT Pelayaran Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Harum Energy and PT Pelayaran
The main advantage of trading using opposite Harum Energy and PT Pelayaran positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harum Energy position performs unexpectedly, PT Pelayaran 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 PT Pelayaran will offset losses from the drop in PT Pelayaran's long position.| Harum Energy vs. Indo Tambangraya Megah | Harum Energy vs. Indika Energy Tbk | Harum Energy vs. Adaro Energy Tbk | Harum Energy vs. Akr Corporindo Tbk |
| PT Pelayaran vs. Intermedia Capital Tbk | PT Pelayaran vs. Dyandra Media International | PT Pelayaran vs. Garuda Metalindo Tbk | PT Pelayaran vs. Metrodata Electronics 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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