Correlation Between Sampoerna Agro and Hotel Sahid
Can any of the company-specific risk be diversified away by investing in both Sampoerna Agro and Hotel Sahid 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 Sampoerna Agro and Hotel Sahid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sampoerna Agro Tbk and Hotel Sahid Jaya, you can compare the effects of market volatilities on Sampoerna Agro and Hotel Sahid 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 Sampoerna Agro with a short position of Hotel Sahid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sampoerna Agro and Hotel Sahid.
Diversification Opportunities for Sampoerna Agro and Hotel Sahid
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sampoerna and Hotel is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Sampoerna Agro Tbk and Hotel Sahid Jaya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hotel Sahid Jaya and Sampoerna Agro 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 Sampoerna Agro Tbk are associated (or correlated) with Hotel Sahid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hotel Sahid Jaya has no effect on the direction of Sampoerna Agro i.e., Sampoerna Agro and Hotel Sahid go up and down completely randomly.
Pair Corralation between Sampoerna Agro and Hotel Sahid
Assuming the 90 days trading horizon Sampoerna Agro Tbk is expected to generate 0.18 times more return on investment than Hotel Sahid. However, Sampoerna Agro Tbk is 5.61 times less risky than Hotel Sahid. It trades about 0.04 of its potential returns per unit of risk. Hotel Sahid Jaya is currently generating about -0.03 per unit of risk. If you would invest 183,601 in Sampoerna Agro Tbk on November 2, 2024 and sell it today you would earn a total of 32,399 from holding Sampoerna Agro Tbk or generate 17.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Sampoerna Agro Tbk vs. Hotel Sahid Jaya
Performance |
| Timeline |
| Sampoerna Agro Tbk |
| Hotel Sahid Jaya |
Sampoerna Agro and Hotel Sahid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sampoerna Agro and Hotel Sahid
The main advantage of trading using opposite Sampoerna Agro and Hotel Sahid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sampoerna Agro position performs unexpectedly, Hotel Sahid 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 Hotel Sahid will offset losses from the drop in Hotel Sahid's long position.| Sampoerna Agro vs. Bakrie Sumatera Plantations | Sampoerna Agro vs. Perusahaan Perkebunan London | Sampoerna Agro vs. Astra Agro Lestari | Sampoerna Agro vs. Tunas Baru Lampung |
| Hotel Sahid vs. Pembangunan Jaya Ancol | Hotel Sahid vs. Panorama Sentrawisata Tbk | Hotel Sahid vs. Sona Topas Tourism | Hotel Sahid vs. Millennium Pharmacon International |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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