Correlation Between SBM OFFSHORE and INDO-RAMA SYNTHETIC
Can any of the company-specific risk be diversified away by investing in both SBM OFFSHORE and INDO-RAMA SYNTHETIC 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 SBM OFFSHORE and INDO-RAMA SYNTHETIC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SBM OFFSHORE and INDO RAMA SYNTHETIC, you can compare the effects of market volatilities on SBM OFFSHORE and INDO-RAMA SYNTHETIC 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 SBM OFFSHORE with a short position of INDO-RAMA SYNTHETIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of SBM OFFSHORE and INDO-RAMA SYNTHETIC.
Diversification Opportunities for SBM OFFSHORE and INDO-RAMA SYNTHETIC
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SBM and INDO-RAMA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding SBM OFFSHORE and INDO RAMA SYNTHETIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INDO RAMA SYNTHETIC and SBM OFFSHORE 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 SBM OFFSHORE are associated (or correlated) with INDO-RAMA SYNTHETIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INDO RAMA SYNTHETIC has no effect on the direction of SBM OFFSHORE i.e., SBM OFFSHORE and INDO-RAMA SYNTHETIC go up and down completely randomly.
Pair Corralation between SBM OFFSHORE and INDO-RAMA SYNTHETIC
If you would invest 21.00 in INDO RAMA SYNTHETIC on September 14, 2024 and sell it today you would earn a total of 0.00 from holding INDO RAMA SYNTHETIC or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SBM OFFSHORE vs. INDO RAMA SYNTHETIC
Performance |
| Timeline |
| SBM OFFSHORE |
| INDO RAMA SYNTHETIC |
SBM OFFSHORE and INDO-RAMA SYNTHETIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SBM OFFSHORE and INDO-RAMA SYNTHETIC
The main advantage of trading using opposite SBM OFFSHORE and INDO-RAMA SYNTHETIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SBM OFFSHORE position performs unexpectedly, INDO-RAMA SYNTHETIC 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 INDO-RAMA SYNTHETIC will offset losses from the drop in INDO-RAMA SYNTHETIC's long position.| SBM OFFSHORE vs. Apple Inc | SBM OFFSHORE vs. Apple Inc | SBM OFFSHORE vs. Apple Inc | SBM OFFSHORE vs. Apple Inc |
| INDO-RAMA SYNTHETIC vs. Apple Inc | INDO-RAMA SYNTHETIC vs. Apple Inc | INDO-RAMA SYNTHETIC vs. Apple Inc | INDO-RAMA SYNTHETIC vs. Apple Inc |
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.
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