Correlation Between Hotel Sahid and Arthavest Tbk
Can any of the company-specific risk be diversified away by investing in both Hotel Sahid and Arthavest Tbk 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 Hotel Sahid and Arthavest Tbk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hotel Sahid Jaya and Arthavest Tbk, you can compare the effects of market volatilities on Hotel Sahid and Arthavest Tbk 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 Hotel Sahid with a short position of Arthavest Tbk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hotel Sahid and Arthavest Tbk.
Diversification Opportunities for Hotel Sahid and Arthavest Tbk
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hotel and Arthavest is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Hotel Sahid Jaya and Arthavest Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arthavest Tbk and Hotel Sahid 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 Hotel Sahid Jaya are associated (or correlated) with Arthavest Tbk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arthavest Tbk has no effect on the direction of Hotel Sahid i.e., Hotel Sahid and Arthavest Tbk go up and down completely randomly.
Pair Corralation between Hotel Sahid and Arthavest Tbk
Assuming the 90 days trading horizon Hotel Sahid Jaya is expected to under-perform the Arthavest Tbk. In addition to that, Hotel Sahid is 2.4 times more volatile than Arthavest Tbk. It trades about -0.02 of its total potential returns per unit of risk. Arthavest Tbk is currently generating about 0.02 per unit of volatility. If you would invest 218,093 in Arthavest Tbk on October 7, 2024 and sell it today you would earn a total of 12,907 from holding Arthavest Tbk or generate 5.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hotel Sahid Jaya vs. Arthavest Tbk
Performance |
| Timeline |
| Hotel Sahid Jaya |
| Arthavest Tbk |
Hotel Sahid and Arthavest Tbk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hotel Sahid and Arthavest Tbk
The main advantage of trading using opposite Hotel Sahid and Arthavest Tbk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hotel Sahid position performs unexpectedly, Arthavest Tbk 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 Arthavest Tbk will offset losses from the drop in Arthavest Tbk's long position.| Hotel Sahid vs. Pembangunan Jaya Ancol | Hotel Sahid vs. Panorama Sentrawisata Tbk | Hotel Sahid vs. Sona Topas Tourism | Hotel Sahid vs. Millennium Pharmacon International |
| Arthavest Tbk vs. Asuransi Bintang Tbk | Arthavest Tbk vs. Pacific Strategic Financial | Arthavest Tbk vs. Maming Enam Sembilan | Arthavest Tbk vs. Asuransi Harta Aman |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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