Correlation Between Steel Pipe and Ifishdeco
Can any of the company-specific risk be diversified away by investing in both Steel Pipe and Ifishdeco 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 Steel Pipe and Ifishdeco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Steel Pipe Industry and Ifishdeco PT, you can compare the effects of market volatilities on Steel Pipe and Ifishdeco 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 Steel Pipe with a short position of Ifishdeco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steel Pipe and Ifishdeco.
Diversification Opportunities for Steel Pipe and Ifishdeco
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Steel and Ifishdeco is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Steel Pipe Industry and Ifishdeco PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ifishdeco PT and Steel Pipe 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 Steel Pipe Industry are associated (or correlated) with Ifishdeco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ifishdeco PT has no effect on the direction of Steel Pipe i.e., Steel Pipe and Ifishdeco go up and down completely randomly.
Pair Corralation between Steel Pipe and Ifishdeco
Assuming the 90 days trading horizon Steel Pipe Industry is expected to generate 0.29 times more return on investment than Ifishdeco. However, Steel Pipe Industry is 3.5 times less risky than Ifishdeco. It trades about -0.37 of its potential returns per unit of risk. Ifishdeco PT is currently generating about -0.11 per unit of risk. If you would invest 30,200 in Steel Pipe Industry on August 31, 2024 and sell it today you would lose (1,800) from holding Steel Pipe Industry or give up 5.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Steel Pipe Industry vs. Ifishdeco PT
Performance |
| Timeline |
| Steel Pipe Industry |
| Ifishdeco PT |
Steel Pipe and Ifishdeco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Steel Pipe and Ifishdeco
The main advantage of trading using opposite Steel Pipe and Ifishdeco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Steel Pipe position performs unexpectedly, Ifishdeco 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 Ifishdeco will offset losses from the drop in Ifishdeco's long position.| Steel Pipe vs. Perusahaan Gas Negara | Steel Pipe vs. Vale Indonesia Tbk | Steel Pipe vs. Telkom Indonesia Tbk | Steel Pipe vs. Mitra Pinasthika Mustika |
| Ifishdeco vs. Merdeka Copper Gold | Ifishdeco vs. Aneka Tambang Persero | Ifishdeco vs. Bumi Resources Minerals | Ifishdeco vs. Timah Persero Tbk |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Global Correlations Find global opportunities by holding instruments from different markets |