Correlation Between Jakarta Int and Tirta Mahakam
Can any of the company-specific risk be diversified away by investing in both Jakarta Int and Tirta Mahakam 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 Tirta Mahakam 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 Tirta Mahakam Resources, you can compare the effects of market volatilities on Jakarta Int and Tirta Mahakam 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 Tirta Mahakam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jakarta Int and Tirta Mahakam.
Diversification Opportunities for Jakarta Int and Tirta Mahakam
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Jakarta and Tirta is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Jakarta Int Hotels and Tirta Mahakam Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tirta Mahakam Resources 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 Tirta Mahakam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tirta Mahakam Resources has no effect on the direction of Jakarta Int i.e., Jakarta Int and Tirta Mahakam go up and down completely randomly.
Pair Corralation between Jakarta Int and Tirta Mahakam
Assuming the 90 days trading horizon Jakarta Int Hotels is expected to generate 1.94 times more return on investment than Tirta Mahakam. However, Jakarta Int is 1.94 times more volatile than Tirta Mahakam Resources. It trades about 0.25 of its potential returns per unit of risk. Tirta Mahakam Resources is currently generating about 0.44 per unit of risk. If you would invest 118,500 in Jakarta Int Hotels on September 9, 2024 and sell it today you would earn a total of 79,000 from holding Jakarta Int Hotels or generate 66.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jakarta Int Hotels vs. Tirta Mahakam Resources
Performance |
| Timeline |
| Jakarta Int Hotels |
| Tirta Mahakam Resources |
Jakarta Int and Tirta Mahakam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jakarta Int and Tirta Mahakam
The main advantage of trading using opposite Jakarta Int and Tirta Mahakam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jakarta Int position performs unexpectedly, Tirta Mahakam 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 Tirta Mahakam will offset losses from the drop in Tirta Mahakam's long position.| Jakarta Int vs. Mitra Adiperkasa Tbk | Jakarta Int vs. Mitra Keluarga Karyasehat | Jakarta Int vs. Medikaloka Hermina PT | Jakarta Int vs. Prodia Widyahusada Tbk |
| Tirta Mahakam vs. Slj Global Tbk | Tirta Mahakam vs. Indo Acidatama Tbk | Tirta Mahakam vs. Trias Sentosa Tbk | Tirta Mahakam vs. Suparma 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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