Correlation Between PT Primadaya and PT Puri
Can any of the company-specific risk be diversified away by investing in both PT Primadaya and PT Puri 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 Primadaya and PT Puri into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Primadaya Plastisindo and PT Puri Sentul, you can compare the effects of market volatilities on PT Primadaya and PT Puri 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 Primadaya with a short position of PT Puri. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Primadaya and PT Puri.
Diversification Opportunities for PT Primadaya and PT Puri
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between PDPP and KDTN is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding PT Primadaya Plastisindo and PT Puri Sentul in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Puri Sentul and PT Primadaya 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 Primadaya Plastisindo are associated (or correlated) with PT Puri. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Puri Sentul has no effect on the direction of PT Primadaya i.e., PT Primadaya and PT Puri go up and down completely randomly.
Pair Corralation between PT Primadaya and PT Puri
Assuming the 90 days trading horizon PT Primadaya Plastisindo is expected to generate 17.24 times more return on investment than PT Puri. However, PT Primadaya is 17.24 times more volatile than PT Puri Sentul. It trades about 0.05 of its potential returns per unit of risk. PT Puri Sentul is currently generating about -0.01 per unit of risk. If you would invest 16,159 in PT Primadaya Plastisindo on September 3, 2024 and sell it today you would earn a total of 38,841 from holding PT Primadaya Plastisindo or generate 240.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Primadaya Plastisindo vs. PT Puri Sentul
Performance |
| Timeline |
| PT Primadaya Plastisindo |
| PT Puri Sentul |
PT Primadaya and PT Puri Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Primadaya and PT Puri
The main advantage of trading using opposite PT Primadaya and PT Puri positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Primadaya position performs unexpectedly, PT Puri 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 PT Puri will offset losses from the drop in PT Puri's long position.| PT Primadaya vs. Lippo General Insurance | PT Primadaya vs. Alumindo Light Metal | PT Primadaya vs. Communication Cable Systems | PT Primadaya vs. Inocycle Technology Tbk |
| PT Puri vs. PT Primadaya Plastisindo | PT Puri vs. PT Ketrosden Triasmitra | PT Puri vs. Menthobi Karyatama Raya | PT Puri vs. Jayamas Medica Industri |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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