Correlation Between Pelayaran Nelly and Garuda Metalindo
Can any of the company-specific risk be diversified away by investing in both Pelayaran Nelly and Garuda Metalindo 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 Pelayaran Nelly and Garuda Metalindo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pelayaran Nelly Dwi and Garuda Metalindo Tbk, you can compare the effects of market volatilities on Pelayaran Nelly and Garuda Metalindo 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 Pelayaran Nelly with a short position of Garuda Metalindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pelayaran Nelly and Garuda Metalindo.
Diversification Opportunities for Pelayaran Nelly and Garuda Metalindo
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pelayaran and Garuda is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Pelayaran Nelly Dwi and Garuda Metalindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garuda Metalindo Tbk and Pelayaran Nelly 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 Pelayaran Nelly Dwi are associated (or correlated) with Garuda Metalindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garuda Metalindo Tbk has no effect on the direction of Pelayaran Nelly i.e., Pelayaran Nelly and Garuda Metalindo go up and down completely randomly.
Pair Corralation between Pelayaran Nelly and Garuda Metalindo
Assuming the 90 days trading horizon Pelayaran Nelly is expected to generate 1.2 times less return on investment than Garuda Metalindo. In addition to that, Pelayaran Nelly is 1.53 times more volatile than Garuda Metalindo Tbk. It trades about 0.05 of its total potential returns per unit of risk. Garuda Metalindo Tbk is currently generating about 0.09 per unit of volatility. If you would invest 68,378 in Garuda Metalindo Tbk on November 27, 2024 and sell it today you would earn a total of 65,622 from holding Garuda Metalindo Tbk or generate 95.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pelayaran Nelly Dwi vs. Garuda Metalindo Tbk
Performance |
| Timeline |
| Pelayaran Nelly Dwi |
| Garuda Metalindo Tbk |
Pelayaran Nelly and Garuda Metalindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pelayaran Nelly and Garuda Metalindo
The main advantage of trading using opposite Pelayaran Nelly and Garuda Metalindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pelayaran Nelly position performs unexpectedly, Garuda Metalindo 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 Garuda Metalindo will offset losses from the drop in Garuda Metalindo's long position.| Pelayaran Nelly vs. Bisi International Tbk | Pelayaran Nelly vs. Sampoerna Agro Tbk | Pelayaran Nelly vs. Akr Corporindo Tbk | Pelayaran Nelly vs. Solusi Bangun Indonesia |
| Garuda Metalindo vs. Indo Kordsa Tbk | Garuda Metalindo vs. Indospring Tbk | Garuda Metalindo vs. Kabelindo Murni Tbk | Garuda Metalindo vs. Blue Bird 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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