Correlation Between PT Barito and Hoist Finance
Can any of the company-specific risk be diversified away by investing in both PT Barito and Hoist Finance 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 PT Barito and Hoist Finance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Barito Pacific and Hoist Finance AB, you can compare the effects of market volatilities on PT Barito and Hoist Finance 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 PT Barito with a short position of Hoist Finance. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Barito and Hoist Finance.
Diversification Opportunities for PT Barito and Hoist Finance
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between OB8 and Hoist is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding PT Barito Pacific and Hoist Finance AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hoist Finance AB and PT Barito 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 PT Barito Pacific are associated (or correlated) with Hoist Finance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hoist Finance AB has no effect on the direction of PT Barito i.e., PT Barito and Hoist Finance go up and down completely randomly.
Pair Corralation between PT Barito and Hoist Finance
Assuming the 90 days horizon PT Barito is expected to generate 1.44 times less return on investment than Hoist Finance. In addition to that, PT Barito is 3.14 times more volatile than Hoist Finance AB. It trades about 0.03 of its total potential returns per unit of risk. Hoist Finance AB is currently generating about 0.14 per unit of volatility. If you would invest 230.00 in Hoist Finance AB on September 26, 2024 and sell it today you would earn a total of 554.00 from holding Hoist Finance AB or generate 240.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Barito Pacific vs. Hoist Finance AB
Performance |
| Timeline |
| PT Barito Pacific |
| Hoist Finance AB |
PT Barito and Hoist Finance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Barito and Hoist Finance
The main advantage of trading using opposite PT Barito and Hoist Finance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Barito position performs unexpectedly, Hoist Finance 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 Hoist Finance will offset losses from the drop in Hoist Finance's long position.| PT Barito vs. Air Liquide SA | PT Barito vs. AIR LIQUIDE ADR | PT Barito vs. Shin Etsu Chemical Co | PT Barito vs. BASF SE |
| Hoist Finance vs. Far East Horizon | Hoist Finance vs. Walker Dunlop | Hoist Finance vs. Paragon Banking Group | Hoist Finance vs. Hercules Capital |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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