Correlation Between Krakatau Steel and Indosterling Technomedia
Can any of the company-specific risk be diversified away by investing in both Krakatau Steel and Indosterling Technomedia 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 Krakatau Steel and Indosterling Technomedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Krakatau Steel Persero and Indosterling Technomedia Tbk, you can compare the effects of market volatilities on Krakatau Steel and Indosterling Technomedia 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 Krakatau Steel with a short position of Indosterling Technomedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Krakatau Steel and Indosterling Technomedia.
Diversification Opportunities for Krakatau Steel and Indosterling Technomedia
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Krakatau and Indosterling is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Krakatau Steel Persero and Indosterling Technomedia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indosterling Technomedia and Krakatau Steel 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 Krakatau Steel Persero are associated (or correlated) with Indosterling Technomedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indosterling Technomedia has no effect on the direction of Krakatau Steel i.e., Krakatau Steel and Indosterling Technomedia go up and down completely randomly.
Pair Corralation between Krakatau Steel and Indosterling Technomedia
If you would invest 11,700 in Krakatau Steel Persero on August 29, 2024 and sell it today you would earn a total of 400.00 from holding Krakatau Steel Persero or generate 3.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Krakatau Steel Persero vs. Indosterling Technomedia Tbk
Performance |
| Timeline |
| Krakatau Steel Persero |
| Indosterling Technomedia |
Krakatau Steel and Indosterling Technomedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Krakatau Steel and Indosterling Technomedia
The main advantage of trading using opposite Krakatau Steel and Indosterling Technomedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Krakatau Steel position performs unexpectedly, Indosterling Technomedia 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 Indosterling Technomedia will offset losses from the drop in Indosterling Technomedia's long position.| Krakatau Steel vs. Timah Persero Tbk | Krakatau Steel vs. Garuda Indonesia Persero | Krakatau Steel vs. Jasa Marga Tbk | Krakatau Steel vs. Semen Indonesia Persero |
| Indosterling Technomedia vs. Multipolar Technology Tbk | Indosterling Technomedia vs. Digital Mediatama Maxima | Indosterling Technomedia vs. M Cash Integrasi | Indosterling Technomedia vs. NFC Indonesia PT |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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