Correlation Between PP Presisi and Bukaka Teknik
Can any of the company-specific risk be diversified away by investing in both PP Presisi and Bukaka Teknik 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 PP Presisi and Bukaka Teknik into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PP Presisi Tbk and Bukaka Teknik Utama, you can compare the effects of market volatilities on PP Presisi and Bukaka Teknik 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 PP Presisi with a short position of Bukaka Teknik. Check out your portfolio center. Please also check ongoing floating volatility patterns of PP Presisi and Bukaka Teknik.
Diversification Opportunities for PP Presisi and Bukaka Teknik
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between PPRE and Bukaka is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding PP Presisi Tbk and Bukaka Teknik Utama in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bukaka Teknik Utama and PP Presisi 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 PP Presisi Tbk are associated (or correlated) with Bukaka Teknik. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bukaka Teknik Utama has no effect on the direction of PP Presisi i.e., PP Presisi and Bukaka Teknik go up and down completely randomly.
Pair Corralation between PP Presisi and Bukaka Teknik
Assuming the 90 days trading horizon PP Presisi Tbk is expected to generate 1.12 times more return on investment than Bukaka Teknik. However, PP Presisi is 1.12 times more volatile than Bukaka Teknik Utama. It trades about -0.04 of its potential returns per unit of risk. Bukaka Teknik Utama is currently generating about -0.08 per unit of risk. If you would invest 5,700 in PP Presisi Tbk on November 5, 2024 and sell it today you would lose (100.00) from holding PP Presisi Tbk or give up 1.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
PP Presisi Tbk vs. Bukaka Teknik Utama
Performance |
| Timeline |
| PP Presisi Tbk |
| Bukaka Teknik Utama |
PP Presisi and Bukaka Teknik Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PP Presisi and Bukaka Teknik
The main advantage of trading using opposite PP Presisi and Bukaka Teknik positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PP Presisi position performs unexpectedly, Bukaka Teknik 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 Bukaka Teknik will offset losses from the drop in Bukaka Teknik's long position.| PP Presisi vs. Wijaya Karya Bangunan | PP Presisi vs. PP Properti Tbk | PP Presisi vs. Wijaya Karya Beton | PP Presisi vs. Soechi Lines Tbk |
| Bukaka Teknik vs. Indo Kordsa Tbk | Bukaka Teknik vs. Wilmar Cahaya Indonesia | Bukaka Teknik vs. Citra Marga Nusaphala | Bukaka Teknik vs. Darya Varia Laboratoria 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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