Correlation Between Kalbe Farma and Jasa Marga
Can any of the company-specific risk be diversified away by investing in both Kalbe Farma and Jasa Marga 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 Kalbe Farma and Jasa Marga into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kalbe Farma Tbk and Jasa Marga Tbk, you can compare the effects of market volatilities on Kalbe Farma and Jasa Marga 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 Kalbe Farma with a short position of Jasa Marga. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kalbe Farma and Jasa Marga.
Diversification Opportunities for Kalbe Farma and Jasa Marga
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kalbe and Jasa is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Kalbe Farma Tbk and Jasa Marga Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jasa Marga Tbk and Kalbe Farma 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 Kalbe Farma Tbk are associated (or correlated) with Jasa Marga. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jasa Marga Tbk has no effect on the direction of Kalbe Farma i.e., Kalbe Farma and Jasa Marga go up and down completely randomly.
Pair Corralation between Kalbe Farma and Jasa Marga
Assuming the 90 days trading horizon Kalbe Farma Tbk is expected to under-perform the Jasa Marga. But the stock apears to be less risky and, when comparing its historical volatility, Kalbe Farma Tbk is 1.11 times less risky than Jasa Marga. The stock trades about -0.38 of its potential returns per unit of risk. The Jasa Marga Tbk is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 431,000 in Jasa Marga Tbk on October 25, 2024 and sell it today you would earn a total of 11,000 from holding Jasa Marga Tbk or generate 2.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 94.74% |
| Values | Daily Returns |
Kalbe Farma Tbk vs. Jasa Marga Tbk
Performance |
| Timeline |
| Kalbe Farma Tbk |
| Jasa Marga Tbk |
Kalbe Farma and Jasa Marga Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kalbe Farma and Jasa Marga
The main advantage of trading using opposite Kalbe Farma and Jasa Marga positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kalbe Farma position performs unexpectedly, Jasa Marga 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 Jasa Marga will offset losses from the drop in Jasa Marga's long position.| Kalbe Farma vs. PT Indofood Sukses | Kalbe Farma vs. Unilever Indonesia Tbk | Kalbe Farma vs. Semen Indonesia Persero | Kalbe Farma vs. United Tractors Tbk |
| Jasa Marga vs. Semen Indonesia Persero | Jasa Marga vs. Wijaya Karya Beton | Jasa Marga vs. Perusahaan Gas Negara | Jasa Marga vs. PT Indofood Sukses |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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