Correlation Between Hotel Sahid and Ricky Putra
Can any of the company-specific risk be diversified away by investing in both Hotel Sahid and Ricky Putra 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 Ricky Putra 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 Ricky Putra Globalindo, you can compare the effects of market volatilities on Hotel Sahid and Ricky Putra 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 Ricky Putra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hotel Sahid and Ricky Putra.
Diversification Opportunities for Hotel Sahid and Ricky Putra
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hotel and Ricky is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Hotel Sahid Jaya and Ricky Putra Globalindo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ricky Putra Globalindo 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 Ricky Putra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ricky Putra Globalindo has no effect on the direction of Hotel Sahid i.e., Hotel Sahid and Ricky Putra go up and down completely randomly.
Pair Corralation between Hotel Sahid and Ricky Putra
Assuming the 90 days trading horizon Hotel Sahid Jaya is expected to generate 1.91 times more return on investment than Ricky Putra. However, Hotel Sahid is 1.91 times more volatile than Ricky Putra Globalindo. It trades about 0.02 of its potential returns per unit of risk. Ricky Putra Globalindo is currently generating about -0.15 per unit of risk. If you would invest 94,500 in Hotel Sahid Jaya on August 28, 2024 and sell it today you would earn a total of 0.00 from holding Hotel Sahid Jaya or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Hotel Sahid Jaya vs. Ricky Putra Globalindo
Performance |
| Timeline |
| Hotel Sahid Jaya |
| Ricky Putra Globalindo |
Hotel Sahid and Ricky Putra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hotel Sahid and Ricky Putra
The main advantage of trading using opposite Hotel Sahid and Ricky Putra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hotel Sahid position performs unexpectedly, Ricky Putra 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 Ricky Putra will offset losses from the drop in Ricky Putra'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 |
| Ricky Putra vs. Pan Brothers Tbk | Ricky Putra vs. Sunson Textile Manufacturer | Ricky Putra vs. Asia Pacific Fibers | Ricky Putra vs. Prima Alloy Steel |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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