Correlation Between Samindo Resources and Radiant Utama
Can any of the company-specific risk be diversified away by investing in both Samindo Resources and Radiant Utama 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 Samindo Resources and Radiant Utama into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samindo Resources Tbk and Radiant Utama Interinsco, you can compare the effects of market volatilities on Samindo Resources and Radiant Utama 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 Samindo Resources with a short position of Radiant Utama. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samindo Resources and Radiant Utama.
Diversification Opportunities for Samindo Resources and Radiant Utama
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Samindo and Radiant is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Samindo Resources Tbk and Radiant Utama Interinsco in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Radiant Utama Interinsco and Samindo Resources 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 Samindo Resources Tbk are associated (or correlated) with Radiant Utama. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Radiant Utama Interinsco has no effect on the direction of Samindo Resources i.e., Samindo Resources and Radiant Utama go up and down completely randomly.
Pair Corralation between Samindo Resources and Radiant Utama
Assuming the 90 days trading horizon Samindo Resources Tbk is expected to generate 2.88 times more return on investment than Radiant Utama. However, Samindo Resources is 2.88 times more volatile than Radiant Utama Interinsco. It trades about 0.23 of its potential returns per unit of risk. Radiant Utama Interinsco is currently generating about -0.22 per unit of risk. If you would invest 131,000 in Samindo Resources Tbk on August 25, 2024 and sell it today you would earn a total of 18,500 from holding Samindo Resources Tbk or generate 14.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Samindo Resources Tbk vs. Radiant Utama Interinsco
Performance |
| Timeline |
| Samindo Resources Tbk |
| Radiant Utama Interinsco |
Samindo Resources and Radiant Utama Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samindo Resources and Radiant Utama
The main advantage of trading using opposite Samindo Resources and Radiant Utama positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samindo Resources position performs unexpectedly, Radiant Utama 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 Radiant Utama will offset losses from the drop in Radiant Utama's long position.| Samindo Resources vs. Resource Alam Indonesia | Samindo Resources vs. Petrosea Tbk | Samindo Resources vs. Kmi Wire And | Samindo Resources vs. Mitrabara Adiperdana PT |
| Radiant Utama vs. Petrosea Tbk | Radiant Utama vs. Harum Energy Tbk | Radiant Utama vs. Perdana Karya Perkasa | Radiant Utama vs. Samindo Resources 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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