Correlation Between Rukun Raharja and Wijaya Karya
Can any of the company-specific risk be diversified away by investing in both Rukun Raharja and Wijaya Karya 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 Wijaya Karya 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 Wijaya Karya Beton, you can compare the effects of market volatilities on Rukun Raharja and Wijaya Karya 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 Wijaya Karya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rukun Raharja and Wijaya Karya.
Diversification Opportunities for Rukun Raharja and Wijaya Karya
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Rukun and Wijaya is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Rukun Raharja Tbk and Wijaya Karya Beton in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wijaya Karya Beton 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 Wijaya Karya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wijaya Karya Beton has no effect on the direction of Rukun Raharja i.e., Rukun Raharja and Wijaya Karya go up and down completely randomly.
Pair Corralation between Rukun Raharja and Wijaya Karya
Assuming the 90 days trading horizon Rukun Raharja Tbk is expected to generate 1.72 times more return on investment than Wijaya Karya. However, Rukun Raharja is 1.72 times more volatile than Wijaya Karya Beton. It trades about 0.23 of its potential returns per unit of risk. Wijaya Karya Beton is currently generating about -0.2 per unit of risk. If you would invest 173,500 in Rukun Raharja Tbk on August 29, 2024 and sell it today you would earn a total of 60,500 from holding Rukun Raharja Tbk or generate 34.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rukun Raharja Tbk vs. Wijaya Karya Beton
Performance |
| Timeline |
| Rukun Raharja Tbk |
| Wijaya Karya Beton |
Rukun Raharja and Wijaya Karya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rukun Raharja and Wijaya Karya
The main advantage of trading using opposite Rukun Raharja and Wijaya Karya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rukun Raharja position performs unexpectedly, Wijaya Karya 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 Wijaya Karya will offset losses from the drop in Wijaya Karya'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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |