Correlation Between Link Net and Personel Alih
Can any of the company-specific risk be diversified away by investing in both Link Net and Personel Alih 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 Link Net and Personel Alih into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Link Net Tbk and Personel Alih Daya, you can compare the effects of market volatilities on Link Net and Personel Alih 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 Link Net with a short position of Personel Alih. Check out your portfolio center. Please also check ongoing floating volatility patterns of Link Net and Personel Alih.
Diversification Opportunities for Link Net and Personel Alih
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Link and Personel is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Link Net Tbk and Personel Alih Daya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Personel Alih Daya and Link Net 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 Link Net Tbk are associated (or correlated) with Personel Alih. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Personel Alih Daya has no effect on the direction of Link Net i.e., Link Net and Personel Alih go up and down completely randomly.
Pair Corralation between Link Net and Personel Alih
Assuming the 90 days trading horizon Link Net Tbk is expected to under-perform the Personel Alih. But the stock apears to be less risky and, when comparing its historical volatility, Link Net Tbk is 1.23 times less risky than Personel Alih. The stock trades about -0.2 of its potential returns per unit of risk. The Personel Alih Daya is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 1,400 in Personel Alih Daya on August 30, 2024 and sell it today you would lose (200.00) from holding Personel Alih Daya or give up 14.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Link Net Tbk vs. Personel Alih Daya
Performance |
| Timeline |
| Link Net Tbk |
| Personel Alih Daya |
Link Net and Personel Alih Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Link Net and Personel Alih
The main advantage of trading using opposite Link Net and Personel Alih positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Link Net position performs unexpectedly, Personel Alih 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 Personel Alih will offset losses from the drop in Personel Alih's long position.| Link Net vs. Mitra Keluarga Karyasehat | Link Net vs. Surya Citra Media | Link Net vs. Matahari Department Store | Link Net vs. Puradelta Lestari PT |
| Personel Alih vs. PT Surya Pertiwi | Personel Alih vs. Satria Mega Kencana | Personel Alih vs. Multifiling Mitra Indonesia | Personel Alih vs. Royal Prima 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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