Correlation Between Jakarta Int and Bumi Citra
Can any of the company-specific risk be diversified away by investing in both Jakarta Int and Bumi Citra 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 Jakarta Int and Bumi Citra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jakarta Int Hotels and Bumi Citra Permai, you can compare the effects of market volatilities on Jakarta Int and Bumi Citra 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 Jakarta Int with a short position of Bumi Citra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jakarta Int and Bumi Citra.
Diversification Opportunities for Jakarta Int and Bumi Citra
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Jakarta and Bumi is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Jakarta Int Hotels and Bumi Citra Permai in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bumi Citra Permai and Jakarta Int 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 Jakarta Int Hotels are associated (or correlated) with Bumi Citra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bumi Citra Permai has no effect on the direction of Jakarta Int i.e., Jakarta Int and Bumi Citra go up and down completely randomly.
Pair Corralation between Jakarta Int and Bumi Citra
Assuming the 90 days trading horizon Jakarta Int Hotels is expected to generate 1.93 times more return on investment than Bumi Citra. However, Jakarta Int is 1.93 times more volatile than Bumi Citra Permai. It trades about 0.18 of its potential returns per unit of risk. Bumi Citra Permai is currently generating about 0.0 per unit of risk. If you would invest 39,800 in Jakarta Int Hotels on September 2, 2024 and sell it today you would earn a total of 257,200 from holding Jakarta Int Hotels or generate 646.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jakarta Int Hotels vs. Bumi Citra Permai
Performance |
| Timeline |
| Jakarta Int Hotels |
| Bumi Citra Permai |
Jakarta Int and Bumi Citra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jakarta Int and Bumi Citra
The main advantage of trading using opposite Jakarta Int and Bumi Citra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jakarta Int position performs unexpectedly, Bumi Citra 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 Bumi Citra will offset losses from the drop in Bumi Citra's long position.| Jakarta Int vs. Jaya Real Property | Jakarta Int vs. Mnc Land Tbk | Jakarta Int vs. Kawasan Industri Jababeka | Jakarta Int vs. Duta Pertiwi Tbk |
| Bumi Citra vs. Lippo Cikarang Tbk | Bumi Citra vs. Lippo Karawaci Tbk | Bumi Citra vs. Mitra Pinasthika Mustika | Bumi Citra vs. Jakarta Int Hotels |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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