Correlation Between Pelita Samudera and GTS Internasional
Can any of the company-specific risk be diversified away by investing in both Pelita Samudera and GTS Internasional 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 Pelita Samudera and GTS Internasional into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pelita Samudera Shipping and GTS Internasional Tbk, you can compare the effects of market volatilities on Pelita Samudera and GTS Internasional 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 Pelita Samudera with a short position of GTS Internasional. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pelita Samudera and GTS Internasional.
Diversification Opportunities for Pelita Samudera and GTS Internasional
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Pelita and GTS is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Pelita Samudera Shipping and GTS Internasional Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GTS Internasional Tbk and Pelita Samudera 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 Pelita Samudera Shipping are associated (or correlated) with GTS Internasional. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GTS Internasional Tbk has no effect on the direction of Pelita Samudera i.e., Pelita Samudera and GTS Internasional go up and down completely randomly.
Pair Corralation between Pelita Samudera and GTS Internasional
Assuming the 90 days trading horizon Pelita Samudera Shipping is expected to generate 0.28 times more return on investment than GTS Internasional. However, Pelita Samudera Shipping is 3.54 times less risky than GTS Internasional. It trades about -0.14 of its potential returns per unit of risk. GTS Internasional Tbk is currently generating about -0.23 per unit of risk. If you would invest 42,800 in Pelita Samudera Shipping on September 2, 2024 and sell it today you would lose (800.00) from holding Pelita Samudera Shipping or give up 1.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pelita Samudera Shipping vs. GTS Internasional Tbk
Performance |
| Timeline |
| Pelita Samudera Shipping |
| GTS Internasional Tbk |
Pelita Samudera and GTS Internasional Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pelita Samudera and GTS Internasional
The main advantage of trading using opposite Pelita Samudera and GTS Internasional positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pelita Samudera position performs unexpectedly, GTS Internasional 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 GTS Internasional will offset losses from the drop in GTS Internasional's long position.| Pelita Samudera vs. Matahari Department Store | Pelita Samudera vs. Multi Medika Internasional | Pelita Samudera vs. Visi Media Asia | Pelita Samudera vs. Bayan Resources Tbk |
| GTS Internasional vs. Transcoal Pacific Tbk | GTS Internasional vs. PT Temas Tbk | GTS Internasional vs. Samudera Indonesia Tbk | GTS Internasional vs. Pelita Samudera Shipping |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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