Correlation Between Pertamina Geothermal and Trimitra Prawara
Can any of the company-specific risk be diversified away by investing in both Pertamina Geothermal and Trimitra Prawara 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 Pertamina Geothermal and Trimitra Prawara into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pertamina Geothermal Energy and Trimitra Prawara Goldland, you can compare the effects of market volatilities on Pertamina Geothermal and Trimitra Prawara 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 Pertamina Geothermal with a short position of Trimitra Prawara. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pertamina Geothermal and Trimitra Prawara.
Diversification Opportunities for Pertamina Geothermal and Trimitra Prawara
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Pertamina and Trimitra is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Pertamina Geothermal Energy and Trimitra Prawara Goldland in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trimitra Prawara Goldland and Pertamina Geothermal 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 Pertamina Geothermal Energy are associated (or correlated) with Trimitra Prawara. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trimitra Prawara Goldland has no effect on the direction of Pertamina Geothermal i.e., Pertamina Geothermal and Trimitra Prawara go up and down completely randomly.
Pair Corralation between Pertamina Geothermal and Trimitra Prawara
Assuming the 90 days trading horizon Pertamina Geothermal Energy is expected to generate 0.79 times more return on investment than Trimitra Prawara. However, Pertamina Geothermal Energy is 1.27 times less risky than Trimitra Prawara. It trades about 0.03 of its potential returns per unit of risk. Trimitra Prawara Goldland is currently generating about -0.05 per unit of risk. If you would invest 82,919 in Pertamina Geothermal Energy on September 3, 2024 and sell it today you would earn a total of 16,081 from holding Pertamina Geothermal Energy or generate 19.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 89.01% |
| Values | Daily Returns |
Pertamina Geothermal Energy vs. Trimitra Prawara Goldland
Performance |
| Timeline |
| Pertamina Geothermal |
| Trimitra Prawara Goldland |
Pertamina Geothermal and Trimitra Prawara Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pertamina Geothermal and Trimitra Prawara
The main advantage of trading using opposite Pertamina Geothermal and Trimitra Prawara positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pertamina Geothermal position performs unexpectedly, Trimitra Prawara 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 Trimitra Prawara will offset losses from the drop in Trimitra Prawara's long position.| Pertamina Geothermal vs. Chandra Asri Petrochemical | Pertamina Geothermal vs. Bank Negara Indonesia | Pertamina Geothermal vs. Sumber Alfaria Trijaya | Pertamina Geothermal vs. Mitra Pinasthika Mustika |
| Trimitra Prawara vs. Merdeka Copper Gold | Trimitra Prawara vs. Pertamina Geothermal Energy | Trimitra Prawara vs. Trinitan Metals and | Trimitra Prawara vs. Eastparc Hotel 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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