Correlation Between Jakarta Int and Sarana Meditama
Can any of the company-specific risk be diversified away by investing in both Jakarta Int and Sarana Meditama 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 Sarana Meditama 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 Sarana Meditama Metropolitan, you can compare the effects of market volatilities on Jakarta Int and Sarana Meditama 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 Sarana Meditama. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jakarta Int and Sarana Meditama.
Diversification Opportunities for Jakarta Int and Sarana Meditama
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Jakarta and Sarana is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Jakarta Int Hotels and Sarana Meditama Metropolitan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sarana Meditama Metr 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 Sarana Meditama. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sarana Meditama Metr has no effect on the direction of Jakarta Int i.e., Jakarta Int and Sarana Meditama go up and down completely randomly.
Pair Corralation between Jakarta Int and Sarana Meditama
Assuming the 90 days trading horizon Jakarta Int Hotels is expected to generate 3.48 times more return on investment than Sarana Meditama. However, Jakarta Int is 3.48 times more volatile than Sarana Meditama Metropolitan. It trades about 0.23 of its potential returns per unit of risk. Sarana Meditama Metropolitan is currently generating about 0.19 per unit of risk. If you would invest 118,500 in Jakarta Int Hotels on September 12, 2024 and sell it today you would earn a total of 67,500 from holding Jakarta Int Hotels or generate 56.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Jakarta Int Hotels vs. Sarana Meditama Metropolitan
Performance |
| Timeline |
| Jakarta Int Hotels |
| Sarana Meditama Metr |
Jakarta Int and Sarana Meditama Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jakarta Int and Sarana Meditama
The main advantage of trading using opposite Jakarta Int and Sarana Meditama positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jakarta Int position performs unexpectedly, Sarana Meditama 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 Sarana Meditama will offset losses from the drop in Sarana Meditama'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 |
| Sarana Meditama vs. Mitra Keluarga Karyasehat | Sarana Meditama vs. Siloam International Hospitals | Sarana Meditama vs. Sumber Alfaria Trijaya | Sarana Meditama vs. Elang Mahkota Teknologi |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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