Correlation Between Surya Citra and Lion Metal
Can any of the company-specific risk be diversified away by investing in both Surya Citra and Lion Metal 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 Surya Citra and Lion Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Surya Citra Media and Lion Metal Works, you can compare the effects of market volatilities on Surya Citra and Lion Metal 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 Surya Citra with a short position of Lion Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surya Citra and Lion Metal.
Diversification Opportunities for Surya Citra and Lion Metal
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Surya and Lion is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Surya Citra Media and Lion Metal Works in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion Metal Works and Surya Citra 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 Surya Citra Media are associated (or correlated) with Lion Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion Metal Works has no effect on the direction of Surya Citra i.e., Surya Citra and Lion Metal go up and down completely randomly.
Pair Corralation between Surya Citra and Lion Metal
Assuming the 90 days trading horizon Surya Citra Media is expected to generate 0.41 times more return on investment than Lion Metal. However, Surya Citra Media is 2.43 times less risky than Lion Metal. It trades about -0.11 of its potential returns per unit of risk. Lion Metal Works is currently generating about -0.17 per unit of risk. If you would invest 12,772 in Surya Citra Media on August 30, 2024 and sell it today you would lose (672.00) from holding Surya Citra Media or give up 5.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Surya Citra Media vs. Lion Metal Works
Performance |
| Timeline |
| Surya Citra Media |
| Lion Metal Works |
Surya Citra and Lion Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Surya Citra and Lion Metal
The main advantage of trading using opposite Surya Citra and Lion Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Surya Citra position performs unexpectedly, Lion Metal 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 Lion Metal will offset losses from the drop in Lion Metal's long position.| Surya Citra vs. Bank Artos Indonesia | Surya Citra vs. PT Bukalapak | Surya Citra vs. Sumber Alfaria Trijaya | Surya Citra vs. Merdeka Copper Gold |
| Lion Metal vs. Lionmesh Prima Tbk | Lion Metal vs. Pelangi Indah Canindo | Lion Metal vs. Indal Aluminium Industry | Lion Metal vs. Intanwijaya Internasional Tbk |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Transaction History View history of all your transactions and understand their impact on performance |