Correlation Between Ace Oldfields and Indo Oil
Can any of the company-specific risk be diversified away by investing in both Ace Oldfields and Indo Oil 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 Ace Oldfields and Indo Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ace Oldfields PT and Indo Oil Perkasa, you can compare the effects of market volatilities on Ace Oldfields and Indo Oil 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 Ace Oldfields with a short position of Indo Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ace Oldfields and Indo Oil.
Diversification Opportunities for Ace Oldfields and Indo Oil
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ace and Indo is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Ace Oldfields PT and Indo Oil Perkasa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indo Oil Perkasa and Ace Oldfields 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 Ace Oldfields PT are associated (or correlated) with Indo Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indo Oil Perkasa has no effect on the direction of Ace Oldfields i.e., Ace Oldfields and Indo Oil go up and down completely randomly.
Pair Corralation between Ace Oldfields and Indo Oil
Assuming the 90 days trading horizon Ace Oldfields PT is expected to generate 0.48 times more return on investment than Indo Oil. However, Ace Oldfields PT is 2.09 times less risky than Indo Oil. It trades about 0.0 of its potential returns per unit of risk. Indo Oil Perkasa is currently generating about -0.03 per unit of risk. If you would invest 5,183 in Ace Oldfields PT on August 30, 2024 and sell it today you would lose (183.00) from holding Ace Oldfields PT or give up 3.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ace Oldfields PT vs. Indo Oil Perkasa
Performance |
| Timeline |
| Ace Oldfields PT |
| Indo Oil Perkasa |
Ace Oldfields and Indo Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ace Oldfields and Indo Oil
The main advantage of trading using opposite Ace Oldfields and Indo Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ace Oldfields position performs unexpectedly, Indo Oil 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 Indo Oil will offset losses from the drop in Indo Oil's long position.| Ace Oldfields vs. Ladangbaja Murni PT | Ace Oldfields vs. PT Hasnur Internasional | Ace Oldfields vs. Geoprima Solusi Tbk | Ace Oldfields vs. Prima Andalan Mandiri |
| Indo Oil vs. Sentra Food Indonesia | Indo Oil vs. Buyung Poetra Sembada | Indo Oil vs. Garudafood Putra Putri | Indo Oil vs. Campina Ice Cream |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |