Correlation Between Rogers Communications and Telkom Indonesia
Can any of the company-specific risk be diversified away by investing in both Rogers Communications and Telkom Indonesia 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 Rogers Communications and Telkom Indonesia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rogers Communications and Telkom Indonesia Tbk, you can compare the effects of market volatilities on Rogers Communications and Telkom Indonesia 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 Rogers Communications with a short position of Telkom Indonesia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rogers Communications and Telkom Indonesia.
Diversification Opportunities for Rogers Communications and Telkom Indonesia
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Rogers and Telkom is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Rogers Communications and Telkom Indonesia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telkom Indonesia Tbk and Rogers Communications 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 Rogers Communications are associated (or correlated) with Telkom Indonesia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telkom Indonesia Tbk has no effect on the direction of Rogers Communications i.e., Rogers Communications and Telkom Indonesia go up and down completely randomly.
Pair Corralation between Rogers Communications and Telkom Indonesia
Considering the 90-day investment horizon Rogers Communications is expected to generate 0.58 times more return on investment than Telkom Indonesia. However, Rogers Communications is 1.73 times less risky than Telkom Indonesia. It trades about -0.15 of its potential returns per unit of risk. Telkom Indonesia Tbk is currently generating about -0.15 per unit of risk. If you would invest 3,731 in Rogers Communications on August 27, 2024 and sell it today you would lose (143.00) from holding Rogers Communications or give up 3.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rogers Communications vs. Telkom Indonesia Tbk
Performance |
| Timeline |
| Rogers Communications |
| Telkom Indonesia Tbk |
Rogers Communications and Telkom Indonesia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rogers Communications and Telkom Indonesia
The main advantage of trading using opposite Rogers Communications and Telkom Indonesia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rogers Communications position performs unexpectedly, Telkom Indonesia 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 Telkom Indonesia will offset losses from the drop in Telkom Indonesia's long position.| Rogers Communications vs. Anterix | Rogers Communications vs. Liberty Broadband Corp | Rogers Communications vs. Ooma Inc | Rogers Communications vs. IDT Corporation |
| Telkom Indonesia vs. Liberty Broadband Srs | Telkom Indonesia vs. Ribbon Communications | Telkom Indonesia vs. Liberty Broadband Srs | Telkom Indonesia vs. Shenandoah Telecommunications Co |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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