Correlation Between Jakarta Int and Charnic Capital
Can any of the company-specific risk be diversified away by investing in both Jakarta Int and Charnic Capital 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 Charnic Capital 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 Charnic Capital Tbk, you can compare the effects of market volatilities on Jakarta Int and Charnic Capital 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 Charnic Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jakarta Int and Charnic Capital.
Diversification Opportunities for Jakarta Int and Charnic Capital
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Jakarta and Charnic is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Jakarta Int Hotels and Charnic Capital Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Charnic Capital Tbk 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 Charnic Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Charnic Capital Tbk has no effect on the direction of Jakarta Int i.e., Jakarta Int and Charnic Capital go up and down completely randomly.
Pair Corralation between Jakarta Int and Charnic Capital
Assuming the 90 days trading horizon Jakarta Int Hotels is expected to generate 2.38 times more return on investment than Charnic Capital. However, Jakarta Int is 2.38 times more volatile than Charnic Capital Tbk. It trades about 0.36 of its potential returns per unit of risk. Charnic Capital Tbk is currently generating about 0.07 per unit of risk. If you would invest 33,400 in Jakarta Int Hotels on September 4, 2024 and sell it today you would earn a total of 167,600 from holding Jakarta Int Hotels or generate 501.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jakarta Int Hotels vs. Charnic Capital Tbk
Performance |
| Timeline |
| Jakarta Int Hotels |
| Charnic Capital Tbk |
Jakarta Int and Charnic Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jakarta Int and Charnic Capital
The main advantage of trading using opposite Jakarta Int and Charnic Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jakarta Int position performs unexpectedly, Charnic Capital 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 Charnic Capital will offset losses from the drop in Charnic Capital'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 |
| Charnic Capital vs. Mitra Pinasthika Mustika | Charnic Capital vs. Jakarta Int Hotels | Charnic Capital vs. Asuransi Harta Aman | Charnic Capital vs. Indosterling Technomedia 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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