Correlation Between Perdana Bangun and Akbar Indomakmur
Can any of the company-specific risk be diversified away by investing in both Perdana Bangun and Akbar Indomakmur 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 Perdana Bangun and Akbar Indomakmur into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Perdana Bangun Pusaka and Akbar Indomakmur Stimec, you can compare the effects of market volatilities on Perdana Bangun and Akbar Indomakmur 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 Perdana Bangun with a short position of Akbar Indomakmur. Check out your portfolio center. Please also check ongoing floating volatility patterns of Perdana Bangun and Akbar Indomakmur.
Diversification Opportunities for Perdana Bangun and Akbar Indomakmur
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Perdana and Akbar is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Perdana Bangun Pusaka and Akbar Indomakmur Stimec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akbar Indomakmur Stimec and Perdana Bangun 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 Perdana Bangun Pusaka are associated (or correlated) with Akbar Indomakmur. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akbar Indomakmur Stimec has no effect on the direction of Perdana Bangun i.e., Perdana Bangun and Akbar Indomakmur go up and down completely randomly.
Pair Corralation between Perdana Bangun and Akbar Indomakmur
Assuming the 90 days trading horizon Perdana Bangun Pusaka is expected to generate 4.72 times more return on investment than Akbar Indomakmur. However, Perdana Bangun is 4.72 times more volatile than Akbar Indomakmur Stimec. It trades about 0.36 of its potential returns per unit of risk. Akbar Indomakmur Stimec is currently generating about -0.14 per unit of risk. If you would invest 91,000 in Perdana Bangun Pusaka on August 25, 2024 and sell it today you would earn a total of 113,000 from holding Perdana Bangun Pusaka or generate 124.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Perdana Bangun Pusaka vs. Akbar Indomakmur Stimec
Performance |
| Timeline |
| Perdana Bangun Pusaka |
| Akbar Indomakmur Stimec |
Perdana Bangun and Akbar Indomakmur Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Perdana Bangun and Akbar Indomakmur
The main advantage of trading using opposite Perdana Bangun and Akbar Indomakmur positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Perdana Bangun position performs unexpectedly, Akbar Indomakmur 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 Akbar Indomakmur will offset losses from the drop in Akbar Indomakmur's long position.| Perdana Bangun vs. Inter Delta Tbk | Perdana Bangun vs. Jakarta Setiabudi Internasional | Perdana Bangun vs. Multi Indocitra Tbk | Perdana Bangun vs. Jasuindo Tiga Perkasa |
| Akbar Indomakmur vs. Bayu Buana Tbk | Akbar Indomakmur vs. Alakasa Industrindo Tbk | Akbar Indomakmur vs. Mahaka Media Tbk | Akbar Indomakmur vs. Arthavest Tbk |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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