Correlation Between Inocycle Technology and Lippo General
Can any of the company-specific risk be diversified away by investing in both Inocycle Technology and Lippo General 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 Inocycle Technology and Lippo General into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Inocycle Technology Tbk and Lippo General Insurance, you can compare the effects of market volatilities on Inocycle Technology and Lippo General 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 Inocycle Technology with a short position of Lippo General. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inocycle Technology and Lippo General.
Diversification Opportunities for Inocycle Technology and Lippo General
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Inocycle and Lippo is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Inocycle Technology Tbk and Lippo General Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lippo General Insurance and Inocycle Technology 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 Inocycle Technology Tbk are associated (or correlated) with Lippo General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lippo General Insurance has no effect on the direction of Inocycle Technology i.e., Inocycle Technology and Lippo General go up and down completely randomly.
Pair Corralation between Inocycle Technology and Lippo General
Assuming the 90 days trading horizon Inocycle Technology Tbk is expected to under-perform the Lippo General. In addition to that, Inocycle Technology is 6.73 times more volatile than Lippo General Insurance. It trades about -0.11 of its total potential returns per unit of risk. Lippo General Insurance is currently generating about -0.38 per unit of volatility. If you would invest 32,200 in Lippo General Insurance on November 3, 2024 and sell it today you would lose (800.00) from holding Lippo General Insurance or give up 2.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inocycle Technology Tbk vs. Lippo General Insurance
Performance |
| Timeline |
| Inocycle Technology Tbk |
| Lippo General Insurance |
Inocycle Technology and Lippo General Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inocycle Technology and Lippo General
The main advantage of trading using opposite Inocycle Technology and Lippo General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inocycle Technology position performs unexpectedly, Lippo General 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 Lippo General will offset losses from the drop in Lippo General's long position.| Inocycle Technology vs. MNC Vision Networks | Inocycle Technology vs. Hartadinata Abadi Tbk | Inocycle Technology vs. Kencana Energi Lestari | Inocycle Technology vs. Bali Bintang Sejahtera |
| Lippo General vs. Maskapai Reasuransi Indonesia | Lippo General vs. Lenox Pasifik Investama | Lippo General vs. Paninvest Tbk | Lippo General vs. Bank Mayapada Internasional |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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