Correlation Between PT Solusi and GRIFFIN MINING
Can any of the company-specific risk be diversified away by investing in both PT Solusi and GRIFFIN MINING 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 PT Solusi and GRIFFIN MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Solusi Bangun and GRIFFIN MINING LTD, you can compare the effects of market volatilities on PT Solusi and GRIFFIN MINING 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 PT Solusi with a short position of GRIFFIN MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Solusi and GRIFFIN MINING.
Diversification Opportunities for PT Solusi and GRIFFIN MINING
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between RU6 and GRIFFIN is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding PT Solusi Bangun and GRIFFIN MINING LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GRIFFIN MINING LTD and PT Solusi 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 PT Solusi Bangun are associated (or correlated) with GRIFFIN MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GRIFFIN MINING LTD has no effect on the direction of PT Solusi i.e., PT Solusi and GRIFFIN MINING go up and down completely randomly.
Pair Corralation between PT Solusi and GRIFFIN MINING
Assuming the 90 days horizon PT Solusi Bangun is expected to generate 11.11 times more return on investment than GRIFFIN MINING. However, PT Solusi is 11.11 times more volatile than GRIFFIN MINING LTD. It trades about 0.05 of its potential returns per unit of risk. GRIFFIN MINING LTD is currently generating about 0.1 per unit of risk. If you would invest 7.50 in PT Solusi Bangun on August 25, 2024 and sell it today you would lose (4.10) from holding PT Solusi Bangun or give up 54.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Solusi Bangun vs. GRIFFIN MINING LTD
Performance |
| Timeline |
| PT Solusi Bangun |
| GRIFFIN MINING LTD |
PT Solusi and GRIFFIN MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Solusi and GRIFFIN MINING
The main advantage of trading using opposite PT Solusi and GRIFFIN MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Solusi position performs unexpectedly, GRIFFIN MINING 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 GRIFFIN MINING will offset losses from the drop in GRIFFIN MINING's long position.| PT Solusi vs. GRIFFIN MINING LTD | PT Solusi vs. METHODE ELECTRONICS | PT Solusi vs. Arrow Electronics | PT Solusi vs. GALENA MINING LTD |
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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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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