Correlation Between HEXINDO ADIPERKASA and GREENX METALS
Can any of the company-specific risk be diversified away by investing in both HEXINDO ADIPERKASA and GREENX METALS 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 GREENX METALS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HEXINDO ADIPERKASA and GREENX METALS LTD, you can compare the effects of market volatilities on HEXINDO ADIPERKASA and GREENX METALS 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 GREENX METALS. Check out your portfolio center. Please also check ongoing floating volatility patterns of HEXINDO ADIPERKASA and GREENX METALS.
Diversification Opportunities for HEXINDO ADIPERKASA and GREENX METALS
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HEXINDO and GREENX is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding HEXINDO ADIPERKASA and GREENX METALS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GREENX METALS LTD 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 GREENX METALS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GREENX METALS LTD has no effect on the direction of HEXINDO ADIPERKASA i.e., HEXINDO ADIPERKASA and GREENX METALS go up and down completely randomly.
Pair Corralation between HEXINDO ADIPERKASA and GREENX METALS
Assuming the 90 days trading horizon HEXINDO ADIPERKASA is expected to generate 0.14 times more return on investment than GREENX METALS. However, HEXINDO ADIPERKASA is 6.92 times less risky than GREENX METALS. It trades about -0.21 of its potential returns per unit of risk. GREENX METALS LTD is currently generating about -0.05 per unit of risk. If you would invest 31.00 in HEXINDO ADIPERKASA on September 15, 2024 and sell it today you would lose (1.00) from holding HEXINDO ADIPERKASA or give up 3.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HEXINDO ADIPERKASA vs. GREENX METALS LTD
Performance |
| Timeline |
| HEXINDO ADIPERKASA |
| GREENX METALS LTD |
HEXINDO ADIPERKASA and GREENX METALS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HEXINDO ADIPERKASA and GREENX METALS
The main advantage of trading using opposite HEXINDO ADIPERKASA and GREENX METALS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HEXINDO ADIPERKASA position performs unexpectedly, GREENX METALS 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 GREENX METALS will offset losses from the drop in GREENX METALS's long position.| HEXINDO ADIPERKASA vs. GREENX METALS LTD | HEXINDO ADIPERKASA vs. SINGAPORE AIRLINES | HEXINDO ADIPERKASA vs. Jacquet Metal Service | HEXINDO ADIPERKASA vs. Kaiser Aluminum |
| GREENX METALS vs. Superior Plus Corp | GREENX METALS vs. SIVERS SEMICONDUCTORS AB | GREENX METALS vs. Norsk Hydro ASA | GREENX METALS vs. Reliance Steel Aluminum |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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