Correlation Between Planet Properindo and Campina Ice
Can any of the company-specific risk be diversified away by investing in both Planet Properindo and Campina Ice 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 Planet Properindo and Campina Ice into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Planet Properindo Jaya and Campina Ice Cream, you can compare the effects of market volatilities on Planet Properindo and Campina Ice 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 Planet Properindo with a short position of Campina Ice. Check out your portfolio center. Please also check ongoing floating volatility patterns of Planet Properindo and Campina Ice.
Diversification Opportunities for Planet Properindo and Campina Ice
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Planet and Campina is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Planet Properindo Jaya and Campina Ice Cream in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Campina Ice Cream and Planet Properindo 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 Planet Properindo Jaya are associated (or correlated) with Campina Ice. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Campina Ice Cream has no effect on the direction of Planet Properindo i.e., Planet Properindo and Campina Ice go up and down completely randomly.
Pair Corralation between Planet Properindo and Campina Ice
Assuming the 90 days trading horizon Planet Properindo Jaya is expected to generate 3.47 times more return on investment than Campina Ice. However, Planet Properindo is 3.47 times more volatile than Campina Ice Cream. It trades about 0.15 of its potential returns per unit of risk. Campina Ice Cream is currently generating about -0.09 per unit of risk. If you would invest 2,400 in Planet Properindo Jaya on September 4, 2024 and sell it today you would earn a total of 400.00 from holding Planet Properindo Jaya or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Planet Properindo Jaya vs. Campina Ice Cream
Performance |
| Timeline |
| Planet Properindo Jaya |
| Campina Ice Cream |
Planet Properindo and Campina Ice Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Planet Properindo and Campina Ice
The main advantage of trading using opposite Planet Properindo and Campina Ice positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Planet Properindo position performs unexpectedly, Campina Ice 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 Campina Ice will offset losses from the drop in Campina Ice's long position.| Planet Properindo vs. PT Boston Furniture | Planet Properindo vs. Sejahtera Bintang Abadi | Planet Properindo vs. Menteng Heritage Realty | Planet Properindo vs. Lancartama Sejati Tbk |
| Campina Ice vs. Sariguna Primatirta PT | Campina Ice vs. Garudafood Putra Putri | Campina Ice vs. Buyung Poetra Sembada | Campina Ice vs. Integra Indocabinet 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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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