Correlation Between Pan Brothers and Ricky Putra
Can any of the company-specific risk be diversified away by investing in both Pan Brothers and Ricky Putra 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 Pan Brothers and Ricky Putra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pan Brothers Tbk and Ricky Putra Globalindo, you can compare the effects of market volatilities on Pan Brothers and Ricky Putra 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 Pan Brothers with a short position of Ricky Putra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pan Brothers and Ricky Putra.
Diversification Opportunities for Pan Brothers and Ricky Putra
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Pan and Ricky is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Pan Brothers Tbk and Ricky Putra Globalindo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ricky Putra Globalindo and Pan Brothers 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 Pan Brothers Tbk are associated (or correlated) with Ricky Putra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ricky Putra Globalindo has no effect on the direction of Pan Brothers i.e., Pan Brothers and Ricky Putra go up and down completely randomly.
Pair Corralation between Pan Brothers and Ricky Putra
Assuming the 90 days trading horizon Pan Brothers Tbk is expected to under-perform the Ricky Putra. But the stock apears to be less risky and, when comparing its historical volatility, Pan Brothers Tbk is 1.18 times less risky than Ricky Putra. The stock trades about -0.07 of its potential returns per unit of risk. The Ricky Putra Globalindo is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 8,700 in Ricky Putra Globalindo on August 28, 2024 and sell it today you would lose (1,200) from holding Ricky Putra Globalindo or give up 13.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pan Brothers Tbk vs. Ricky Putra Globalindo
Performance |
| Timeline |
| Pan Brothers Tbk |
| Ricky Putra Globalindo |
Pan Brothers and Ricky Putra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pan Brothers and Ricky Putra
The main advantage of trading using opposite Pan Brothers and Ricky Putra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pan Brothers position performs unexpectedly, Ricky Putra 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 Ricky Putra will offset losses from the drop in Ricky Putra's long position.| Pan Brothers vs. Ricky Putra Globalindo | Pan Brothers vs. Asia Pacific Fibers | Pan Brothers vs. Asia Pacific Investama | Pan Brothers vs. Prima Alloy Steel |
| Ricky Putra vs. Pan Brothers Tbk | Ricky Putra vs. Sunson Textile Manufacturer | Ricky Putra vs. Asia Pacific Fibers | Ricky Putra vs. Prima Alloy Steel |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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