Correlation Between Pertamina Geothermal and Humpuss Intermoda
Can any of the company-specific risk be diversified away by investing in both Pertamina Geothermal and Humpuss Intermoda 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 Humpuss Intermoda 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 Humpuss Intermoda Transportasi, you can compare the effects of market volatilities on Pertamina Geothermal and Humpuss Intermoda 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 Humpuss Intermoda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pertamina Geothermal and Humpuss Intermoda.
Diversification Opportunities for Pertamina Geothermal and Humpuss Intermoda
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Pertamina and Humpuss is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Pertamina Geothermal Energy and Humpuss Intermoda Transportasi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humpuss Intermoda 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 Humpuss Intermoda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Humpuss Intermoda has no effect on the direction of Pertamina Geothermal i.e., Pertamina Geothermal and Humpuss Intermoda go up and down completely randomly.
Pair Corralation between Pertamina Geothermal and Humpuss Intermoda
Assuming the 90 days trading horizon Pertamina Geothermal Energy is expected to generate 1.14 times more return on investment than Humpuss Intermoda. However, Pertamina Geothermal is 1.14 times more volatile than Humpuss Intermoda Transportasi. It trades about 0.04 of its potential returns per unit of risk. Humpuss Intermoda Transportasi is currently generating about -0.24 per unit of risk. If you would invest 94,000 in Pertamina Geothermal Energy on November 3, 2024 and sell it today you would earn a total of 2,000 from holding Pertamina Geothermal Energy or generate 2.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pertamina Geothermal Energy vs. Humpuss Intermoda Transportasi
Performance |
| Timeline |
| Pertamina Geothermal |
| Humpuss Intermoda |
Pertamina Geothermal and Humpuss Intermoda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pertamina Geothermal and Humpuss Intermoda
The main advantage of trading using opposite Pertamina Geothermal and Humpuss Intermoda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pertamina Geothermal position performs unexpectedly, Humpuss Intermoda 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 Humpuss Intermoda will offset losses from the drop in Humpuss Intermoda's long position.| Pertamina Geothermal vs. Bank Ocbc Nisp | Pertamina Geothermal vs. Weha Transportasi Indonesia | Pertamina Geothermal vs. Wintermar Offshore Marine |
| Humpuss Intermoda vs. PT MNC Energy | Humpuss Intermoda vs. Tanah Laut Tbk | Humpuss Intermoda vs. Indorama Synthetics Tbk | Humpuss Intermoda vs. Fortune Mate Indonesia |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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