Correlation Between Pelita Samudera and Putra Rajawali
Can any of the company-specific risk be diversified away by investing in both Pelita Samudera and Putra Rajawali 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 Putra Rajawali 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 Putra Rajawali Kencana, you can compare the effects of market volatilities on Pelita Samudera and Putra Rajawali 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 Putra Rajawali. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pelita Samudera and Putra Rajawali.
Diversification Opportunities for Pelita Samudera and Putra Rajawali
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Pelita and Putra is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Pelita Samudera Shipping and Putra Rajawali Kencana in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Putra Rajawali Kencana 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 Putra Rajawali. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Putra Rajawali Kencana has no effect on the direction of Pelita Samudera i.e., Pelita Samudera and Putra Rajawali go up and down completely randomly.
Pair Corralation between Pelita Samudera and Putra Rajawali
Assuming the 90 days trading horizon Pelita Samudera Shipping is expected to generate 0.21 times more return on investment than Putra Rajawali. However, Pelita Samudera Shipping is 4.76 times less risky than Putra Rajawali. It trades about 0.01 of its potential returns per unit of risk. Putra Rajawali Kencana is currently generating about -0.08 per unit of risk. If you would invest 41,872 in Pelita Samudera Shipping on September 2, 2024 and sell it today you would earn a total of 128.00 from holding Pelita Samudera Shipping or generate 0.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pelita Samudera Shipping vs. Putra Rajawali Kencana
Performance |
| Timeline |
| Pelita Samudera Shipping |
| Putra Rajawali Kencana |
Pelita Samudera and Putra Rajawali Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pelita Samudera and Putra Rajawali
The main advantage of trading using opposite Pelita Samudera and Putra Rajawali positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pelita Samudera position performs unexpectedly, Putra Rajawali 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 Putra Rajawali will offset losses from the drop in Putra Rajawali'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 |
| Putra Rajawali vs. Kapuas Prima Coal | Putra Rajawali vs. Karya Bersama Anugerah | Putra Rajawali vs. Era Mandiri Cemerlang | Putra Rajawali vs. PP Presisi 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |