Correlation Between Kencana Energi and Saraswanti Anugerah
Can any of the company-specific risk be diversified away by investing in both Kencana Energi and Saraswanti Anugerah 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 Kencana Energi and Saraswanti Anugerah into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kencana Energi Lestari and Saraswanti Anugerah Makmur, you can compare the effects of market volatilities on Kencana Energi and Saraswanti Anugerah 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 Kencana Energi with a short position of Saraswanti Anugerah. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kencana Energi and Saraswanti Anugerah.
Diversification Opportunities for Kencana Energi and Saraswanti Anugerah
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kencana and Saraswanti is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Kencana Energi Lestari and Saraswanti Anugerah Makmur in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saraswanti Anugerah and Kencana Energi 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 Kencana Energi Lestari are associated (or correlated) with Saraswanti Anugerah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saraswanti Anugerah has no effect on the direction of Kencana Energi i.e., Kencana Energi and Saraswanti Anugerah go up and down completely randomly.
Pair Corralation between Kencana Energi and Saraswanti Anugerah
Assuming the 90 days trading horizon Kencana Energi Lestari is expected to under-perform the Saraswanti Anugerah. But the stock apears to be less risky and, when comparing its historical volatility, Kencana Energi Lestari is 1.02 times less risky than Saraswanti Anugerah. The stock trades about -0.04 of its potential returns per unit of risk. The Saraswanti Anugerah Makmur is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 73,177 in Saraswanti Anugerah Makmur on September 14, 2024 and sell it today you would earn a total of 6,823 from holding Saraswanti Anugerah Makmur or generate 9.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kencana Energi Lestari vs. Saraswanti Anugerah Makmur
Performance |
| Timeline |
| Kencana Energi Lestari |
| Saraswanti Anugerah |
Kencana Energi and Saraswanti Anugerah Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kencana Energi and Saraswanti Anugerah
The main advantage of trading using opposite Kencana Energi and Saraswanti Anugerah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kencana Energi position performs unexpectedly, Saraswanti Anugerah 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 Saraswanti Anugerah will offset losses from the drop in Saraswanti Anugerah's long position.| Kencana Energi vs. PT Indonesia Kendaraan | Kencana Energi vs. Cikarang Listrindo Tbk | Kencana Energi vs. Jasa Armada Indonesia | Kencana Energi vs. Pelita Samudera Shipping |
| Saraswanti Anugerah vs. Panca Budi Idaman | Saraswanti Anugerah vs. Gunung Raja Paksi | Saraswanti Anugerah vs. Aneka Gas Industri | Saraswanti Anugerah vs. Mark Dynamics 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |