Correlation Between Sixt Leasing and Telkom Indonesia
Can any of the company-specific risk be diversified away by investing in both Sixt Leasing and Telkom Indonesia 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 Sixt Leasing and Telkom Indonesia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sixt Leasing SE and Telkom Indonesia Tbk, you can compare the effects of market volatilities on Sixt Leasing and Telkom Indonesia 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 Sixt Leasing with a short position of Telkom Indonesia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sixt Leasing and Telkom Indonesia.
Diversification Opportunities for Sixt Leasing and Telkom Indonesia
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sixt and Telkom is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Sixt Leasing SE and Telkom Indonesia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telkom Indonesia Tbk and Sixt Leasing 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 Sixt Leasing SE are associated (or correlated) with Telkom Indonesia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telkom Indonesia Tbk has no effect on the direction of Sixt Leasing i.e., Sixt Leasing and Telkom Indonesia go up and down completely randomly.
Pair Corralation between Sixt Leasing and Telkom Indonesia
Assuming the 90 days trading horizon Sixt Leasing SE is expected to under-perform the Telkom Indonesia. But the stock apears to be less risky and, when comparing its historical volatility, Sixt Leasing SE is 1.95 times less risky than Telkom Indonesia. The stock trades about -0.02 of its potential returns per unit of risk. The Telkom Indonesia Tbk is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 21.00 in Telkom Indonesia Tbk on September 3, 2024 and sell it today you would lose (6.00) from holding Telkom Indonesia Tbk or give up 28.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sixt Leasing SE vs. Telkom Indonesia Tbk
Performance |
| Timeline |
| Sixt Leasing SE |
| Telkom Indonesia Tbk |
Sixt Leasing and Telkom Indonesia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sixt Leasing and Telkom Indonesia
The main advantage of trading using opposite Sixt Leasing and Telkom Indonesia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sixt Leasing position performs unexpectedly, Telkom Indonesia 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 Telkom Indonesia will offset losses from the drop in Telkom Indonesia's long position.| Sixt Leasing vs. Harmony Gold Mining | Sixt Leasing vs. Motorcar Parts of | Sixt Leasing vs. Zijin Mining Group | Sixt Leasing vs. Jacquet Metal Service |
| Telkom Indonesia vs. FAST RETAIL ADR | Telkom Indonesia vs. Costco Wholesale Corp | Telkom Indonesia vs. Sixt Leasing SE | Telkom Indonesia vs. MARKET VECTR RETAIL |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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