Correlation Between Jakarta Int and Fks Multi
Can any of the company-specific risk be diversified away by investing in both Jakarta Int and Fks Multi 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 Fks Multi 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 Fks Multi Agro, you can compare the effects of market volatilities on Jakarta Int and Fks Multi 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 Fks Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jakarta Int and Fks Multi.
Diversification Opportunities for Jakarta Int and Fks Multi
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jakarta and Fks is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Jakarta Int Hotels and Fks Multi Agro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fks Multi Agro 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 Fks Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fks Multi Agro has no effect on the direction of Jakarta Int i.e., Jakarta Int and Fks Multi go up and down completely randomly.
Pair Corralation between Jakarta Int and Fks Multi
Assuming the 90 days trading horizon Jakarta Int Hotels is expected to generate 2.82 times more return on investment than Fks Multi. However, Jakarta Int is 2.82 times more volatile than Fks Multi Agro. It trades about 0.24 of its potential returns per unit of risk. Fks Multi Agro is currently generating about 0.21 per unit of risk. If you would invest 37,000 in Jakarta Int Hotels on September 3, 2024 and sell it today you would earn a total of 260,000 from holding Jakarta Int Hotels or generate 702.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.36% |
| Values | Daily Returns |
Jakarta Int Hotels vs. Fks Multi Agro
Performance |
| Timeline |
| Jakarta Int Hotels |
| Fks Multi Agro |
Jakarta Int and Fks Multi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jakarta Int and Fks Multi
The main advantage of trading using opposite Jakarta Int and Fks Multi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jakarta Int position performs unexpectedly, Fks Multi 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 Fks Multi will offset losses from the drop in Fks Multi's long position.| Jakarta Int vs. Mitra Pinasthika Mustika | Jakarta Int vs. Asuransi Harta Aman | Jakarta Int vs. Indosterling Technomedia Tbk | Jakarta Int vs. Indosat Tbk |
| Fks Multi vs. Astra International Tbk | Fks Multi vs. Unilever Indonesia Tbk | Fks Multi vs. Telkom Indonesia Tbk | Fks Multi vs. Bank Mandiri Persero |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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