Correlation Between PT Indosat and ZIM Integrated
Can any of the company-specific risk be diversified away by investing in both PT Indosat and ZIM Integrated 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 PT Indosat and ZIM Integrated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Indosat Tbk and ZIM Integrated Shipping, you can compare the effects of market volatilities on PT Indosat and ZIM Integrated 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 PT Indosat with a short position of ZIM Integrated. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Indosat and ZIM Integrated.
Diversification Opportunities for PT Indosat and ZIM Integrated
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between IDO1 and ZIM is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding PT Indosat Tbk and ZIM Integrated Shipping in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ZIM Integrated Shipping and PT Indosat 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 PT Indosat Tbk are associated (or correlated) with ZIM Integrated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ZIM Integrated Shipping has no effect on the direction of PT Indosat i.e., PT Indosat and ZIM Integrated go up and down completely randomly.
Pair Corralation between PT Indosat and ZIM Integrated
Assuming the 90 days trading horizon PT Indosat Tbk is expected to under-perform the ZIM Integrated. In addition to that, PT Indosat is 1.26 times more volatile than ZIM Integrated Shipping. It trades about -0.01 of its total potential returns per unit of risk. ZIM Integrated Shipping is currently generating about 0.05 per unit of volatility. If you would invest 1,176 in ZIM Integrated Shipping on November 27, 2024 and sell it today you would earn a total of 832.00 from holding ZIM Integrated Shipping or generate 70.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Indosat Tbk vs. ZIM Integrated Shipping
Performance |
| Timeline |
| PT Indosat Tbk |
| ZIM Integrated Shipping |
PT Indosat and ZIM Integrated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Indosat and ZIM Integrated
The main advantage of trading using opposite PT Indosat and ZIM Integrated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Indosat position performs unexpectedly, ZIM Integrated 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 ZIM Integrated will offset losses from the drop in ZIM Integrated's long position.| PT Indosat vs. Renesas Electronics | PT Indosat vs. Calibre Mining Corp | PT Indosat vs. Coeur Mining | PT Indosat vs. STMicroelectronics NV |
| ZIM Integrated vs. Sims Metal Management | ZIM Integrated vs. FIREWEED METALS P | ZIM Integrated vs. Jacquet Metal Service | ZIM Integrated vs. De Grey Mining |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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