Correlation Between PT Kalbe and Dow Jones
Can any of the company-specific risk be diversified away by investing in both PT Kalbe and Dow Jones 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 PT Kalbe and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Kalbe Farma and Dow Jones Industrial, you can compare the effects of market volatilities on PT Kalbe and Dow Jones 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 PT Kalbe with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Kalbe and Dow Jones.
Diversification Opportunities for PT Kalbe and Dow Jones
Very good diversification
The 3 months correlation between PTKFF and Dow is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding PT Kalbe Farma and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and PT Kalbe 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 PT Kalbe Farma are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of PT Kalbe i.e., PT Kalbe and Dow Jones go up and down completely randomly.
Pair Corralation between PT Kalbe and Dow Jones
Assuming the 90 days horizon PT Kalbe Farma is expected to under-perform the Dow Jones. In addition to that, PT Kalbe is 5.21 times more volatile than Dow Jones Industrial. It trades about -0.01 of its total potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.08 per unit of volatility. If you would invest 3,378,148 in Dow Jones Industrial on August 29, 2024 and sell it today you would earn a total of 1,107,883 from holding Dow Jones Industrial or generate 32.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 62.42% |
| Values | Daily Returns |
PT Kalbe Farma vs. Dow Jones Industrial
Performance |
| Timeline |
PT Kalbe and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
PT Kalbe Farma
Pair trading matchups for PT Kalbe
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with PT Kalbe and Dow Jones
The main advantage of trading using opposite PT Kalbe and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Kalbe position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| PT Kalbe vs. Sanofi ADR | PT Kalbe vs. Bristol Myers Squibb | PT Kalbe vs. AstraZeneca PLC ADR | PT Kalbe vs. Gilead Sciences |
| Dow Jones vs. CECO Environmental Corp | Dow Jones vs. Western Acquisition Ventures | Dow Jones vs. Tyson Foods | Dow Jones vs. Inflection Point Acquisition |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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