Correlation Between Rimo International and Lotte Chemical
Can any of the company-specific risk be diversified away by investing in both Rimo International and Lotte Chemical 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 Rimo International and Lotte Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rimo International Lestari and Lotte Chemical Titan, you can compare the effects of market volatilities on Rimo International and Lotte Chemical 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 Rimo International with a short position of Lotte Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rimo International and Lotte Chemical.
Diversification Opportunities for Rimo International and Lotte Chemical
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Rimo and Lotte is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Rimo International Lestari and Lotte Chemical Titan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lotte Chemical Titan and Rimo International 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 Rimo International Lestari are associated (or correlated) with Lotte Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lotte Chemical Titan has no effect on the direction of Rimo International i.e., Rimo International and Lotte Chemical go up and down completely randomly.
Pair Corralation between Rimo International and Lotte Chemical
If you would invest 5,000 in Rimo International Lestari on September 4, 2024 and sell it today you would earn a total of 0.00 from holding Rimo International Lestari or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rimo International Lestari vs. Lotte Chemical Titan
Performance |
| Timeline |
| Rimo International |
| Lotte Chemical Titan |
Rimo International and Lotte Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rimo International and Lotte Chemical
The main advantage of trading using opposite Rimo International and Lotte Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rimo International position performs unexpectedly, Lotte Chemical 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 Lotte Chemical will offset losses from the drop in Lotte Chemical's long position.| Rimo International vs. Eastparc Hotel Tbk | Rimo International vs. Inocycle Technology Tbk | Rimo International vs. City Retail Developments | Rimo International vs. Ace Hardware Indonesia |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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