Correlation Between Trimitra Propertindo and Ciputra Development
Can any of the company-specific risk be diversified away by investing in both Trimitra Propertindo and Ciputra Development 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 Trimitra Propertindo and Ciputra Development into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trimitra Propertindo Tbk and Ciputra Development Tbk, you can compare the effects of market volatilities on Trimitra Propertindo and Ciputra Development 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 Trimitra Propertindo with a short position of Ciputra Development. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trimitra Propertindo and Ciputra Development.
Diversification Opportunities for Trimitra Propertindo and Ciputra Development
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Trimitra and Ciputra is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Trimitra Propertindo Tbk and Ciputra Development Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ciputra Development Tbk and Trimitra Propertindo 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 Trimitra Propertindo Tbk are associated (or correlated) with Ciputra Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ciputra Development Tbk has no effect on the direction of Trimitra Propertindo i.e., Trimitra Propertindo and Ciputra Development go up and down completely randomly.
Pair Corralation between Trimitra Propertindo and Ciputra Development
Assuming the 90 days trading horizon Trimitra Propertindo Tbk is expected to generate 1.38 times more return on investment than Ciputra Development. However, Trimitra Propertindo is 1.38 times more volatile than Ciputra Development Tbk. It trades about -0.03 of its potential returns per unit of risk. Ciputra Development Tbk is currently generating about -0.14 per unit of risk. If you would invest 2,100 in Trimitra Propertindo Tbk on September 12, 2024 and sell it today you would lose (200.00) from holding Trimitra Propertindo Tbk or give up 9.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trimitra Propertindo Tbk vs. Ciputra Development Tbk
Performance |
| Timeline |
| Trimitra Propertindo Tbk |
| Ciputra Development Tbk |
Trimitra Propertindo and Ciputra Development Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trimitra Propertindo and Ciputra Development
The main advantage of trading using opposite Trimitra Propertindo and Ciputra Development positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trimitra Propertindo position performs unexpectedly, Ciputra Development 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 Ciputra Development will offset losses from the drop in Ciputra Development's long position.| Trimitra Propertindo vs. Ciputra Development Tbk | Trimitra Propertindo vs. Bumi Serpong Damai | Trimitra Propertindo vs. Alam Sutera Realty | Trimitra Propertindo vs. Lippo Karawaci Tbk |
| Ciputra Development vs. Summarecon Agung Tbk | Ciputra Development vs. Bumi Serpong Damai | Ciputra Development vs. Wijaya Karya Beton | Ciputra Development vs. Pakuwon Jati 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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