Correlation Between PT Kusuma and Arthavest Tbk
Can any of the company-specific risk be diversified away by investing in both PT Kusuma 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 PT Kusuma and Arthavest Tbk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Kusuma Kemindo and Arthavest Tbk, you can compare the effects of market volatilities on PT Kusuma 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 PT Kusuma with a short position of Arthavest Tbk. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Kusuma and Arthavest Tbk.
Diversification Opportunities for PT Kusuma and Arthavest Tbk
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between KKES and Arthavest is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding PT Kusuma Kemindo and Arthavest Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arthavest Tbk and PT Kusuma 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 PT Kusuma Kemindo 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 PT Kusuma i.e., PT Kusuma and Arthavest Tbk go up and down completely randomly.
Pair Corralation between PT Kusuma and Arthavest Tbk
Assuming the 90 days trading horizon PT Kusuma Kemindo is expected to under-perform the Arthavest Tbk. In addition to that, PT Kusuma is 1.62 times more volatile than Arthavest Tbk. It trades about -0.07 of its total potential returns per unit of risk. Arthavest Tbk is currently generating about 0.02 per unit of volatility. If you would invest 197,232 in Arthavest Tbk on December 2, 2024 and sell it today you would earn a total of 19,768 from holding Arthavest Tbk or generate 10.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
PT Kusuma Kemindo vs. Arthavest Tbk
Performance |
| Timeline |
| PT Kusuma Kemindo |
| Arthavest Tbk |
PT Kusuma and Arthavest Tbk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Kusuma and Arthavest Tbk
The main advantage of trading using opposite PT Kusuma and Arthavest Tbk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Kusuma 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.| PT Kusuma vs. PT Hetzer Medical | ||
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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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