Correlation Between Bima Sakti and Jasnita Telekomindo
Can any of the company-specific risk be diversified away by investing in both Bima Sakti and Jasnita Telekomindo 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 Bima Sakti and Jasnita Telekomindo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bima Sakti Pertiwi and Jasnita Telekomindo Tbk, you can compare the effects of market volatilities on Bima Sakti and Jasnita Telekomindo 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 Bima Sakti with a short position of Jasnita Telekomindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bima Sakti and Jasnita Telekomindo.
Diversification Opportunities for Bima Sakti and Jasnita Telekomindo
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Bima and Jasnita is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Bima Sakti Pertiwi and Jasnita Telekomindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jasnita Telekomindo Tbk and Bima Sakti 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 Bima Sakti Pertiwi are associated (or correlated) with Jasnita Telekomindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jasnita Telekomindo Tbk has no effect on the direction of Bima Sakti i.e., Bima Sakti and Jasnita Telekomindo go up and down completely randomly.
Pair Corralation between Bima Sakti and Jasnita Telekomindo
Assuming the 90 days trading horizon Bima Sakti Pertiwi is expected to generate 1.63 times more return on investment than Jasnita Telekomindo. However, Bima Sakti is 1.63 times more volatile than Jasnita Telekomindo Tbk. It trades about 0.01 of its potential returns per unit of risk. Jasnita Telekomindo Tbk is currently generating about -0.03 per unit of risk. If you would invest 6,000 in Bima Sakti Pertiwi on September 4, 2024 and sell it today you would lose (900.00) from holding Bima Sakti Pertiwi or give up 15.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.77% |
| Values | Daily Returns |
Bima Sakti Pertiwi vs. Jasnita Telekomindo Tbk
Performance |
| Timeline |
| Bima Sakti Pertiwi |
| Jasnita Telekomindo Tbk |
Bima Sakti and Jasnita Telekomindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bima Sakti and Jasnita Telekomindo
The main advantage of trading using opposite Bima Sakti and Jasnita Telekomindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bima Sakti position performs unexpectedly, Jasnita Telekomindo 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 Jasnita Telekomindo will offset losses from the drop in Jasnita Telekomindo's long position.| Bima Sakti vs. Armidian Karyatama Tbk | Bima Sakti vs. J Resources Asia | Bima Sakti vs. Langgeng Makmur Industri | Bima Sakti vs. Mandala Multifinance Tbk |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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