Correlation Between Leyand International and HK Metals
Can any of the company-specific risk be diversified away by investing in both Leyand International and HK Metals 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 Leyand International and HK Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Leyand International Tbk and HK Metals Utama, you can compare the effects of market volatilities on Leyand International and HK Metals 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 Leyand International with a short position of HK Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leyand International and HK Metals.
Diversification Opportunities for Leyand International and HK Metals
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Leyand and HKMU is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Leyand International Tbk and HK Metals Utama in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HK Metals Utama and Leyand International 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 Leyand International Tbk are associated (or correlated) with HK Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HK Metals Utama has no effect on the direction of Leyand International i.e., Leyand International and HK Metals go up and down completely randomly.
Pair Corralation between Leyand International and HK Metals
If you would invest 5,000 in Leyand International Tbk on October 9, 2024 and sell it today you would lose (3,200) from holding Leyand International Tbk or give up 64.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Leyand International Tbk vs. HK Metals Utama
Performance |
| Timeline |
| Leyand International Tbk |
| HK Metals Utama |
Leyand International and HK Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Leyand International and HK Metals
The main advantage of trading using opposite Leyand International and HK Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leyand International position performs unexpectedly, HK Metals 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 HK Metals will offset losses from the drop in HK Metals' long position.| Leyand International vs. Puradelta Lestari PT | Leyand International vs. Mitra Pinasthika Mustika | Leyand International vs. Wijaya Karya Bangunan | Leyand International vs. PT Sarana Menara |
| HK Metals vs. PT Indonesia Kendaraan | HK Metals vs. Wijaya Karya Bangunan | HK Metals vs. Buyung Poetra Sembada | HK Metals vs. J Resources Asia |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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