Correlation Between International Business and PT Sarana
Can any of the company-specific risk be diversified away by investing in both International Business and PT Sarana 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 International Business and PT Sarana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Business Machines and PT Sarana Menara, you can compare the effects of market volatilities on International Business and PT Sarana 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 International Business with a short position of PT Sarana. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Business and PT Sarana.
Diversification Opportunities for International Business and PT Sarana
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between International and SMNUF is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding International Business Machine and PT Sarana Menara in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Sarana Menara and International Business 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 International Business Machines are associated (or correlated) with PT Sarana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Sarana Menara has no effect on the direction of International Business i.e., International Business and PT Sarana go up and down completely randomly.
Pair Corralation between International Business and PT Sarana
Considering the 90-day investment horizon International Business Machines is expected to generate 0.23 times more return on investment than PT Sarana. However, International Business Machines is 4.4 times less risky than PT Sarana. It trades about 0.09 of its potential returns per unit of risk. PT Sarana Menara is currently generating about -0.14 per unit of risk. If you would invest 18,005 in International Business Machines on August 25, 2024 and sell it today you would earn a total of 4,292 from holding International Business Machines or generate 23.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 29.47% |
| Values | Daily Returns |
International Business Machine vs. PT Sarana Menara
Performance |
| Timeline |
| International Business |
| PT Sarana Menara |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
International Business and PT Sarana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Business and PT Sarana
The main advantage of trading using opposite International Business and PT Sarana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Business position performs unexpectedly, PT Sarana 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 Sarana will offset losses from the drop in PT Sarana's long position.| International Business vs. Data Storage Corp | International Business vs. Usio Inc | International Business vs. ARB IOT Group | International Business vs. FiscalNote Holdings |
| PT Sarana vs. Proximus NV ADR | PT Sarana vs. Singapore Telecommunications Limited | PT Sarana vs. Telstra Limited | PT Sarana vs. MTN Group Ltd |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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