Correlation Between IDX 30 and Royal Prima
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By analyzing existing cross correlation between IDX 30 Jakarta and Royal Prima PT, you can compare the effects of market volatilities on IDX 30 and Royal Prima 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 IDX 30 with a short position of Royal Prima. Check out your portfolio center. Please also check ongoing floating volatility patterns of IDX 30 and Royal Prima.
Diversification Opportunities for IDX 30 and Royal Prima
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IDX and Royal is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding IDX 30 Jakarta and Royal Prima PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Royal Prima PT and IDX 30 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 IDX 30 Jakarta are associated (or correlated) with Royal Prima. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Royal Prima PT has no effect on the direction of IDX 30 i.e., IDX 30 and Royal Prima go up and down completely randomly.
Pair Corralation between IDX 30 and Royal Prima
Assuming the 90 days trading horizon IDX 30 Jakarta is expected to generate 0.22 times more return on investment than Royal Prima. However, IDX 30 Jakarta is 4.6 times less risky than Royal Prima. It trades about -0.03 of its potential returns per unit of risk. Royal Prima PT is currently generating about -0.04 per unit of risk. If you would invest 51,208 in IDX 30 Jakarta on August 24, 2024 and sell it today you would lose (6,341) from holding IDX 30 Jakarta or give up 12.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
IDX 30 Jakarta vs. Royal Prima PT
Performance |
| Timeline |
IDX 30 and Royal Prima Volatility Contrast
Predicted Return Density |
| Returns |
IDX 30 Jakarta
Pair trading matchups for IDX 30
Royal Prima PT
Pair trading matchups for Royal Prima
Pair Trading with IDX 30 and Royal Prima
The main advantage of trading using opposite IDX 30 and Royal Prima positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IDX 30 position performs unexpectedly, Royal Prima 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 Royal Prima will offset losses from the drop in Royal Prima's long position.| IDX 30 vs. Surya Citra Media | IDX 30 vs. Envy Technologies Indonesia | IDX 30 vs. Gunawan Dianjaya Steel | IDX 30 vs. Nanotech Indonesia Global |
| Royal Prima vs. Astra Graphia Tbk | Royal Prima vs. Hexindo Adiperkasa Tbk | Royal Prima vs. Lautan Luas Tbk | Royal Prima vs. Citra Marga Nusaphala |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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