Correlation Between Prima Alloy and Garuda Metalindo
Can any of the company-specific risk be diversified away by investing in both Prima Alloy and Garuda Metalindo 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 Prima Alloy and Garuda Metalindo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Prima Alloy Steel and Garuda Metalindo Tbk, you can compare the effects of market volatilities on Prima Alloy and Garuda Metalindo 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 Prima Alloy with a short position of Garuda Metalindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Prima Alloy and Garuda Metalindo.
Diversification Opportunities for Prima Alloy and Garuda Metalindo
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Prima and Garuda is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Prima Alloy Steel and Garuda Metalindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garuda Metalindo Tbk and Prima Alloy 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 Prima Alloy Steel are associated (or correlated) with Garuda Metalindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garuda Metalindo Tbk has no effect on the direction of Prima Alloy i.e., Prima Alloy and Garuda Metalindo go up and down completely randomly.
Pair Corralation between Prima Alloy and Garuda Metalindo
Assuming the 90 days trading horizon Prima Alloy Steel is expected to under-perform the Garuda Metalindo. In addition to that, Prima Alloy is 1.4 times more volatile than Garuda Metalindo Tbk. It trades about -0.02 of its total potential returns per unit of risk. Garuda Metalindo Tbk is currently generating about 0.06 per unit of volatility. If you would invest 68,843 in Garuda Metalindo Tbk on August 30, 2024 and sell it today you would earn a total of 46,657 from holding Garuda Metalindo Tbk or generate 67.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Prima Alloy Steel vs. Garuda Metalindo Tbk
Performance |
| Timeline |
| Prima Alloy Steel |
| Garuda Metalindo Tbk |
Prima Alloy and Garuda Metalindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Prima Alloy and Garuda Metalindo
The main advantage of trading using opposite Prima Alloy and Garuda Metalindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Prima Alloy position performs unexpectedly, Garuda Metalindo 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 Garuda Metalindo will offset losses from the drop in Garuda Metalindo's long position.| Prima Alloy vs. Pan Brothers Tbk | Prima Alloy vs. Ricky Putra Globalindo | Prima Alloy vs. Asia Pacific Fibers | Prima Alloy vs. Multi Prima Sejahtera |
| Garuda Metalindo vs. Indo Kordsa Tbk | Garuda Metalindo vs. Indospring Tbk | Garuda Metalindo vs. Kabelindo Murni Tbk | Garuda Metalindo vs. Blue Bird 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data |