Correlation Between Jakarta Int and Unggul Indah
Can any of the company-specific risk be diversified away by investing in both Jakarta Int and Unggul Indah 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 Unggul Indah 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 Unggul Indah Cahaya, you can compare the effects of market volatilities on Jakarta Int and Unggul Indah 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 Unggul Indah. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jakarta Int and Unggul Indah.
Diversification Opportunities for Jakarta Int and Unggul Indah
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jakarta and Unggul is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Jakarta Int Hotels and Unggul Indah Cahaya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unggul Indah Cahaya 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 Unggul Indah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unggul Indah Cahaya has no effect on the direction of Jakarta Int i.e., Jakarta Int and Unggul Indah go up and down completely randomly.
Pair Corralation between Jakarta Int and Unggul Indah
Assuming the 90 days trading horizon Jakarta Int Hotels is expected to generate 3.15 times more return on investment than Unggul Indah. However, Jakarta Int is 3.15 times more volatile than Unggul Indah Cahaya. It trades about 0.12 of its potential returns per unit of risk. Unggul Indah Cahaya is currently generating about -0.02 per unit of risk. If you would invest 35,800 in Jakarta Int Hotels on September 3, 2024 and sell it today you would earn a total of 209,200 from holding Jakarta Int Hotels or generate 584.36% 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. Unggul Indah Cahaya
Performance |
| Timeline |
| Jakarta Int Hotels |
| Unggul Indah Cahaya |
Jakarta Int and Unggul Indah Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jakarta Int and Unggul Indah
The main advantage of trading using opposite Jakarta Int and Unggul Indah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jakarta Int position performs unexpectedly, Unggul Indah 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 Unggul Indah will offset losses from the drop in Unggul Indah'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 |
| Unggul Indah vs. Trias Sentosa Tbk | Unggul Indah vs. Suparma Tbk | Unggul Indah vs. Tembaga Mulia Semanan | Unggul Indah vs. Surya Toto Indonesia |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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