Correlation Between Japfa Comfeed and Arthavest Tbk
Can any of the company-specific risk be diversified away by investing in both Japfa Comfeed and Arthavest Tbk 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 Japfa Comfeed and Arthavest Tbk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Japfa Comfeed Indonesia and Arthavest Tbk, you can compare the effects of market volatilities on Japfa Comfeed and Arthavest Tbk 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 Japfa Comfeed with a short position of Arthavest Tbk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Japfa Comfeed and Arthavest Tbk.
Diversification Opportunities for Japfa Comfeed and Arthavest Tbk
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Japfa and Arthavest is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Japfa Comfeed Indonesia and Arthavest Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arthavest Tbk and Japfa Comfeed 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 Japfa Comfeed Indonesia are associated (or correlated) with Arthavest Tbk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arthavest Tbk has no effect on the direction of Japfa Comfeed i.e., Japfa Comfeed and Arthavest Tbk go up and down completely randomly.
Pair Corralation between Japfa Comfeed and Arthavest Tbk
Assuming the 90 days trading horizon Japfa Comfeed Indonesia is expected to generate 1.93 times more return on investment than Arthavest Tbk. However, Japfa Comfeed is 1.93 times more volatile than Arthavest Tbk. It trades about 0.09 of its potential returns per unit of risk. Arthavest Tbk is currently generating about -0.05 per unit of risk. If you would invest 133,416 in Japfa Comfeed Indonesia on September 2, 2024 and sell it today you would earn a total of 38,084 from holding Japfa Comfeed Indonesia or generate 28.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Japfa Comfeed Indonesia vs. Arthavest Tbk
Performance |
| Timeline |
| Japfa Comfeed Indonesia |
| Arthavest Tbk |
Japfa Comfeed and Arthavest Tbk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Japfa Comfeed and Arthavest Tbk
The main advantage of trading using opposite Japfa Comfeed and Arthavest Tbk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Japfa Comfeed position performs unexpectedly, Arthavest Tbk 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 Arthavest Tbk will offset losses from the drop in Arthavest Tbk's long position.| Japfa Comfeed vs. Bank BRISyariah Tbk | Japfa Comfeed vs. Mitra Pinasthika Mustika | Japfa Comfeed vs. Jakarta Int Hotels | Japfa Comfeed vs. Indosterling Technomedia Tbk |
| Arthavest Tbk vs. Asuransi Bintang Tbk | Arthavest Tbk vs. Pacific Strategic Financial | Arthavest Tbk vs. Maming Enam Sembilan | Arthavest Tbk vs. Asuransi Harta Aman |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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