Correlation Between Indofood Cbp and Hanjaya Mandala
Can any of the company-specific risk be diversified away by investing in both Indofood Cbp and Hanjaya Mandala 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 Indofood Cbp and Hanjaya Mandala into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Indofood Cbp Sukses and Hanjaya Mandala Sampoerna, you can compare the effects of market volatilities on Indofood Cbp and Hanjaya Mandala 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 Indofood Cbp with a short position of Hanjaya Mandala. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indofood Cbp and Hanjaya Mandala.
Diversification Opportunities for Indofood Cbp and Hanjaya Mandala
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Indofood and Hanjaya is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Indofood Cbp Sukses and Hanjaya Mandala Sampoerna in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanjaya Mandala Sampoerna and Indofood Cbp 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 Indofood Cbp Sukses are associated (or correlated) with Hanjaya Mandala. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanjaya Mandala Sampoerna has no effect on the direction of Indofood Cbp i.e., Indofood Cbp and Hanjaya Mandala go up and down completely randomly.
Pair Corralation between Indofood Cbp and Hanjaya Mandala
Assuming the 90 days trading horizon Indofood Cbp Sukses is expected to generate 1.33 times more return on investment than Hanjaya Mandala. However, Indofood Cbp is 1.33 times more volatile than Hanjaya Mandala Sampoerna. It trades about -0.16 of its potential returns per unit of risk. Hanjaya Mandala Sampoerna is currently generating about -0.22 per unit of risk. If you would invest 1,265,000 in Indofood Cbp Sukses on August 28, 2024 and sell it today you would lose (70,000) from holding Indofood Cbp Sukses or give up 5.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Indofood Cbp Sukses vs. Hanjaya Mandala Sampoerna
Performance |
| Timeline |
| Indofood Cbp Sukses |
| Hanjaya Mandala Sampoerna |
Indofood Cbp and Hanjaya Mandala Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indofood Cbp and Hanjaya Mandala
The main advantage of trading using opposite Indofood Cbp and Hanjaya Mandala positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indofood Cbp position performs unexpectedly, Hanjaya Mandala 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 Hanjaya Mandala will offset losses from the drop in Hanjaya Mandala's long position.| Indofood Cbp vs. Unilever Indonesia Tbk | Indofood Cbp vs. PT Indofood Sukses | Indofood Cbp vs. Astra International Tbk | Indofood Cbp vs. Telkom Indonesia Tbk |
| Hanjaya Mandala vs. Gudang Garam Tbk | Hanjaya Mandala vs. Unilever Indonesia Tbk | Hanjaya Mandala vs. Indofood Cbp Sukses | Hanjaya Mandala vs. PT Indofood Sukses |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Commodity Directory Find actively traded commodities issued by global exchanges |