Correlation Between PT UBC and PT Data
Can any of the company-specific risk be diversified away by investing in both PT UBC and PT Data 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 UBC and PT Data into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT UBC Medical and PT Data Sinergitama, you can compare the effects of market volatilities on PT UBC and PT Data 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 UBC with a short position of PT Data. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT UBC and PT Data.
Diversification Opportunities for PT UBC and PT Data
Very weak diversification
The 3 months correlation between LABS and ELIT is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding PT UBC Medical and PT Data Sinergitama in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Data Sinergitama and PT UBC 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 UBC Medical are associated (or correlated) with PT Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Data Sinergitama has no effect on the direction of PT UBC i.e., PT UBC and PT Data go up and down completely randomly.
Pair Corralation between PT UBC and PT Data
Assuming the 90 days trading horizon PT UBC Medical is expected to under-perform the PT Data. But the stock apears to be less risky and, when comparing its historical volatility, PT UBC Medical is 1.59 times less risky than PT Data. The stock trades about -0.21 of its potential returns per unit of risk. The PT Data Sinergitama is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 11,500 in PT Data Sinergitama on October 26, 2024 and sell it today you would earn a total of 1,100 from holding PT Data Sinergitama or generate 9.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
PT UBC Medical vs. PT Data Sinergitama
Performance |
| Timeline |
| PT UBC Medical |
| PT Data Sinergitama |
PT UBC and PT Data Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT UBC and PT Data
The main advantage of trading using opposite PT UBC and PT Data positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT UBC position performs unexpectedly, PT Data 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 PT Data will offset losses from the drop in PT Data's long position.| PT UBC vs. Bank Central Asia | PT UBC vs. Bank Rakyat Indonesia | PT UBC vs. Bayan Resources Tbk | PT UBC vs. Bank Mandiri Persero |
| PT Data vs. Victoria Insurance Tbk | PT Data vs. Lippo General Insurance | PT Data vs. PT UBC Medical | PT Data vs. Dharma Polimetal 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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