Correlation Between Indomobil Sukses and Autopedia Sukses
Can any of the company-specific risk be diversified away by investing in both Indomobil Sukses and Autopedia Sukses 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 Indomobil Sukses and Autopedia Sukses into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Indomobil Sukses Internasional and Autopedia Sukses Lestari, you can compare the effects of market volatilities on Indomobil Sukses and Autopedia Sukses 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 Indomobil Sukses with a short position of Autopedia Sukses. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indomobil Sukses and Autopedia Sukses.
Diversification Opportunities for Indomobil Sukses and Autopedia Sukses
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Indomobil and Autopedia is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Indomobil Sukses Internasional and Autopedia Sukses Lestari in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Autopedia Sukses Lestari and Indomobil Sukses 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 Indomobil Sukses Internasional are associated (or correlated) with Autopedia Sukses. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Autopedia Sukses Lestari has no effect on the direction of Indomobil Sukses i.e., Indomobil Sukses and Autopedia Sukses go up and down completely randomly.
Pair Corralation between Indomobil Sukses and Autopedia Sukses
Assuming the 90 days trading horizon Indomobil Sukses Internasional is expected to under-perform the Autopedia Sukses. But the stock apears to be less risky and, when comparing its historical volatility, Indomobil Sukses Internasional is 1.11 times less risky than Autopedia Sukses. The stock trades about -0.03 of its potential returns per unit of risk. The Autopedia Sukses Lestari is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 9,400 in Autopedia Sukses Lestari on August 24, 2024 and sell it today you would lose (700.00) from holding Autopedia Sukses Lestari or give up 7.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Indomobil Sukses Internasional vs. Autopedia Sukses Lestari
Performance |
| Timeline |
| Indomobil Sukses Int |
| Autopedia Sukses Lestari |
Indomobil Sukses and Autopedia Sukses Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indomobil Sukses and Autopedia Sukses
The main advantage of trading using opposite Indomobil Sukses and Autopedia Sukses positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indomobil Sukses position performs unexpectedly, Autopedia Sukses 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 Autopedia Sukses will offset losses from the drop in Autopedia Sukses' long position.| Indomobil Sukses vs. Mitra Pinasthika Mustika | Indomobil Sukses vs. Integra Indocabinet Tbk | Indomobil Sukses vs. Indosat Tbk | Indomobil Sukses vs. Gajah Tunggal Tbk |
| Autopedia Sukses vs. Adaro Minerals Indonesia | Autopedia Sukses vs. Dharma Polimetal Tbk | Autopedia Sukses vs. Wir Asia Tbk | Autopedia Sukses vs. Adi Sarana Armada |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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