Correlation Between HEXINDO ADIPERKASA and CHINA PACINGRGDR5
Can any of the company-specific risk be diversified away by investing in both HEXINDO ADIPERKASA and CHINA PACINGRGDR5 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 CHINA PACINGRGDR5 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HEXINDO ADIPERKASA and CHINA PACINGRGDR5 YC1, you can compare the effects of market volatilities on HEXINDO ADIPERKASA and CHINA PACINGRGDR5 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 CHINA PACINGRGDR5. Check out your portfolio center. Please also check ongoing floating volatility patterns of HEXINDO ADIPERKASA and CHINA PACINGRGDR5.
Diversification Opportunities for HEXINDO ADIPERKASA and CHINA PACINGRGDR5
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HEXINDO and CHINA is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding HEXINDO ADIPERKASA and CHINA PACINGRGDR5 YC1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA PACINGRGDR5 YC1 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 CHINA PACINGRGDR5. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA PACINGRGDR5 YC1 has no effect on the direction of HEXINDO ADIPERKASA i.e., HEXINDO ADIPERKASA and CHINA PACINGRGDR5 go up and down completely randomly.
Pair Corralation between HEXINDO ADIPERKASA and CHINA PACINGRGDR5
Assuming the 90 days trading horizon HEXINDO ADIPERKASA is expected to generate 4.44 times less return on investment than CHINA PACINGRGDR5. But when comparing it to its historical volatility, HEXINDO ADIPERKASA is 1.01 times less risky than CHINA PACINGRGDR5. It trades about 0.01 of its potential returns per unit of risk. CHINA PACINGRGDR5 YC1 is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 2,040 in CHINA PACINGRGDR5 YC1 on November 3, 2024 and sell it today you would earn a total of 20.00 from holding CHINA PACINGRGDR5 YC1 or generate 0.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HEXINDO ADIPERKASA vs. CHINA PACINGRGDR5 YC1
Performance |
| Timeline |
| HEXINDO ADIPERKASA |
| CHINA PACINGRGDR5 YC1 |
HEXINDO ADIPERKASA and CHINA PACINGRGDR5 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HEXINDO ADIPERKASA and CHINA PACINGRGDR5
The main advantage of trading using opposite HEXINDO ADIPERKASA and CHINA PACINGRGDR5 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HEXINDO ADIPERKASA position performs unexpectedly, CHINA PACINGRGDR5 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 CHINA PACINGRGDR5 will offset losses from the drop in CHINA PACINGRGDR5's long position.| HEXINDO ADIPERKASA vs. DISTRICT METALS | HEXINDO ADIPERKASA vs. Zijin Mining Group | HEXINDO ADIPERKASA vs. STMICROELECTRONICS | HEXINDO ADIPERKASA vs. Richardson Electronics |
| CHINA PACINGRGDR5 vs. BW OFFSHORE LTD | CHINA PACINGRGDR5 vs. Salesforce | CHINA PACINGRGDR5 vs. CARSALESCOM | CHINA PACINGRGDR5 vs. TRADEDOUBLER AB SK |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |