Correlation Between Lautan Luas and Kioson Komersial
Can any of the company-specific risk be diversified away by investing in both Lautan Luas and Kioson Komersial 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 Lautan Luas and Kioson Komersial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lautan Luas Tbk and Kioson Komersial Indonesia, you can compare the effects of market volatilities on Lautan Luas and Kioson Komersial 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 Lautan Luas with a short position of Kioson Komersial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lautan Luas and Kioson Komersial.
Diversification Opportunities for Lautan Luas and Kioson Komersial
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Lautan and Kioson is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Lautan Luas Tbk and Kioson Komersial Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kioson Komersial Ind and Lautan Luas 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 Lautan Luas Tbk are associated (or correlated) with Kioson Komersial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kioson Komersial Ind has no effect on the direction of Lautan Luas i.e., Lautan Luas and Kioson Komersial go up and down completely randomly.
Pair Corralation between Lautan Luas and Kioson Komersial
Assuming the 90 days trading horizon Lautan Luas Tbk is expected to generate 0.7 times more return on investment than Kioson Komersial. However, Lautan Luas Tbk is 1.43 times less risky than Kioson Komersial. It trades about 0.0 of its potential returns per unit of risk. Kioson Komersial Indonesia is currently generating about -0.03 per unit of risk. If you would invest 100,000 in Lautan Luas Tbk on September 13, 2024 and sell it today you would earn a total of 0.00 from holding Lautan Luas Tbk or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lautan Luas Tbk vs. Kioson Komersial Indonesia
Performance |
| Timeline |
| Lautan Luas Tbk |
| Kioson Komersial Ind |
Lautan Luas and Kioson Komersial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lautan Luas and Kioson Komersial
The main advantage of trading using opposite Lautan Luas and Kioson Komersial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lautan Luas position performs unexpectedly, Kioson Komersial 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 Kioson Komersial will offset losses from the drop in Kioson Komersial's long position.| Lautan Luas vs. Humpuss Intermoda Transportasi | Lautan Luas vs. Trinitan Metals and | Lautan Luas vs. Pacific Strategic Financial | Lautan Luas vs. PT Bank Bisnis |
| Kioson Komersial vs. Multipolar Tbk | Kioson Komersial vs. Astra Graphia Tbk | Kioson Komersial vs. Ramayana Lestari Sentosa | Kioson Komersial vs. Lautan Luas 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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