Correlation Between Rukun Raharja and Adi Sarana
Can any of the company-specific risk be diversified away by investing in both Rukun Raharja and Adi Sarana 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 Rukun Raharja and Adi Sarana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rukun Raharja Tbk and Adi Sarana Armada, you can compare the effects of market volatilities on Rukun Raharja and Adi Sarana 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 Rukun Raharja with a short position of Adi Sarana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rukun Raharja and Adi Sarana.
Diversification Opportunities for Rukun Raharja and Adi Sarana
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Rukun and Adi is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Rukun Raharja Tbk and Adi Sarana Armada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adi Sarana Armada and Rukun Raharja 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 Rukun Raharja Tbk are associated (or correlated) with Adi Sarana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adi Sarana Armada has no effect on the direction of Rukun Raharja i.e., Rukun Raharja and Adi Sarana go up and down completely randomly.
Pair Corralation between Rukun Raharja and Adi Sarana
Assuming the 90 days trading horizon Rukun Raharja Tbk is expected to generate 1.88 times more return on investment than Adi Sarana. However, Rukun Raharja is 1.88 times more volatile than Adi Sarana Armada. It trades about 0.13 of its potential returns per unit of risk. Adi Sarana Armada is currently generating about 0.01 per unit of risk. If you would invest 140,993 in Rukun Raharja Tbk on August 28, 2024 and sell it today you would earn a total of 107,007 from holding Rukun Raharja Tbk or generate 75.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rukun Raharja Tbk vs. Adi Sarana Armada
Performance |
| Timeline |
| Rukun Raharja Tbk |
| Adi Sarana Armada |
Rukun Raharja and Adi Sarana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rukun Raharja and Adi Sarana
The main advantage of trading using opposite Rukun Raharja and Adi Sarana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rukun Raharja position performs unexpectedly, Adi Sarana 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 Adi Sarana will offset losses from the drop in Adi Sarana's long position.| Rukun Raharja vs. Nusantara Infrastructure Tbk | Rukun Raharja vs. Panin Financial Tbk | Rukun Raharja vs. Ramayana Lestari Sentosa | Rukun Raharja vs. Kawasan Industri Jababeka |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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