Correlation Between Ramayana Lestari and Kioson Komersial
Can any of the company-specific risk be diversified away by investing in both Ramayana Lestari and Kioson Komersial 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 Ramayana Lestari and Kioson Komersial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ramayana Lestari Sentosa and Kioson Komersial Indonesia, you can compare the effects of market volatilities on Ramayana Lestari and Kioson Komersial 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 Ramayana Lestari with a short position of Kioson Komersial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ramayana Lestari and Kioson Komersial.
Diversification Opportunities for Ramayana Lestari and Kioson Komersial
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ramayana and Kioson is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Ramayana Lestari Sentosa and Kioson Komersial Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kioson Komersial Ind and Ramayana Lestari 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 Ramayana Lestari Sentosa are associated (or correlated) with Kioson Komersial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kioson Komersial Ind has no effect on the direction of Ramayana Lestari i.e., Ramayana Lestari and Kioson Komersial go up and down completely randomly.
Pair Corralation between Ramayana Lestari and Kioson Komersial
Assuming the 90 days trading horizon Ramayana Lestari Sentosa is expected to under-perform the Kioson Komersial. In addition to that, Ramayana Lestari is 2.64 times more volatile than Kioson Komersial Indonesia. It trades about -0.17 of its total potential returns per unit of risk. Kioson Komersial Indonesia is currently generating about -0.22 per unit of volatility. If you would invest 5,100 in Kioson Komersial Indonesia on August 31, 2024 and sell it today you would lose (100.00) from holding Kioson Komersial Indonesia or give up 1.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ramayana Lestari Sentosa vs. Kioson Komersial Indonesia
Performance |
| Timeline |
| Ramayana Lestari Sentosa |
| Kioson Komersial Ind |
Ramayana Lestari and Kioson Komersial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ramayana Lestari and Kioson Komersial
The main advantage of trading using opposite Ramayana Lestari and Kioson Komersial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ramayana Lestari position performs unexpectedly, Kioson Komersial 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 Kioson Komersial will offset losses from the drop in Kioson Komersial's long position.| Ramayana Lestari vs. Mitra Adiperkasa Tbk | Ramayana Lestari vs. Matahari Putra Prima | Ramayana Lestari vs. Summarecon Agung Tbk | Ramayana Lestari vs. Ciputra Development Tbk |
| Kioson Komersial vs. Multipolar Tbk | Kioson Komersial vs. Astra Graphia Tbk | Kioson Komersial vs. Matahari Putra Prima | Kioson Komersial vs. Ramayana Lestari Sentosa |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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