Correlation Between HEXINDO ADIPERKASA and CIG PANNONIA
Can any of the company-specific risk be diversified away by investing in both HEXINDO ADIPERKASA and CIG PANNONIA 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 HEXINDO ADIPERKASA and CIG PANNONIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HEXINDO ADIPERKASA and CIG PANNONIA LIFE, you can compare the effects of market volatilities on HEXINDO ADIPERKASA and CIG PANNONIA 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 HEXINDO ADIPERKASA with a short position of CIG PANNONIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of HEXINDO ADIPERKASA and CIG PANNONIA.
Diversification Opportunities for HEXINDO ADIPERKASA and CIG PANNONIA
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between HEXINDO and CIG is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding HEXINDO ADIPERKASA and CIG PANNONIA LIFE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIG PANNONIA LIFE and HEXINDO ADIPERKASA 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 HEXINDO ADIPERKASA are associated (or correlated) with CIG PANNONIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIG PANNONIA LIFE has no effect on the direction of HEXINDO ADIPERKASA i.e., HEXINDO ADIPERKASA and CIG PANNONIA go up and down completely randomly.
Pair Corralation between HEXINDO ADIPERKASA and CIG PANNONIA
Assuming the 90 days trading horizon HEXINDO ADIPERKASA is expected to under-perform the CIG PANNONIA. But the stock apears to be less risky and, when comparing its historical volatility, HEXINDO ADIPERKASA is 1.73 times less risky than CIG PANNONIA. The stock trades about -0.24 of its potential returns per unit of risk. The CIG PANNONIA LIFE is currently generating about 0.54 of returns per unit of risk over similar time horizon. If you would invest 84.00 in CIG PANNONIA LIFE on October 24, 2024 and sell it today you would earn a total of 12.00 from holding CIG PANNONIA LIFE or generate 14.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
HEXINDO ADIPERKASA vs. CIG PANNONIA LIFE
Performance |
| Timeline |
| HEXINDO ADIPERKASA |
| CIG PANNONIA LIFE |
HEXINDO ADIPERKASA and CIG PANNONIA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HEXINDO ADIPERKASA and CIG PANNONIA
The main advantage of trading using opposite HEXINDO ADIPERKASA and CIG PANNONIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HEXINDO ADIPERKASA position performs unexpectedly, CIG PANNONIA 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 CIG PANNONIA will offset losses from the drop in CIG PANNONIA's long position.| HEXINDO ADIPERKASA vs. VARIOUS EATERIES LS | HEXINDO ADIPERKASA vs. Madison Square Garden | HEXINDO ADIPERKASA vs. USWE SPORTS AB | HEXINDO ADIPERKASA vs. ETFS Coffee ETC |
| CIG PANNONIA vs. AUTO TRADER ADR | CIG PANNONIA vs. Indutrade AB | CIG PANNONIA vs. Tradegate AG Wertpapierhandelsbank | CIG PANNONIA vs. MeVis Medical Solutions |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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