Correlation Between Hotel Sahid and Satria Mega
Can any of the company-specific risk be diversified away by investing in both Hotel Sahid and Satria Mega 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 Satria Mega 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 Satria Mega Kencana, you can compare the effects of market volatilities on Hotel Sahid and Satria Mega 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 Satria Mega. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hotel Sahid and Satria Mega.
Diversification Opportunities for Hotel Sahid and Satria Mega
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hotel and Satria is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Hotel Sahid Jaya and Satria Mega Kencana in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Satria Mega Kencana 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 Satria Mega. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Satria Mega Kencana has no effect on the direction of Hotel Sahid i.e., Hotel Sahid and Satria Mega go up and down completely randomly.
Pair Corralation between Hotel Sahid and Satria Mega
Assuming the 90 days trading horizon Hotel Sahid Jaya is expected to generate 1.37 times more return on investment than Satria Mega. However, Hotel Sahid is 1.37 times more volatile than Satria Mega Kencana. It trades about 0.04 of its potential returns per unit of risk. Satria Mega Kencana is currently generating about -0.15 per unit of risk. If you would invest 94,000 in Hotel Sahid Jaya on August 30, 2024 and sell it today you would earn a total of 1,500 from holding Hotel Sahid Jaya or generate 1.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hotel Sahid Jaya vs. Satria Mega Kencana
Performance |
| Timeline |
| Hotel Sahid Jaya |
| Satria Mega Kencana |
Hotel Sahid and Satria Mega Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hotel Sahid and Satria Mega
The main advantage of trading using opposite Hotel Sahid and Satria Mega positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hotel Sahid position performs unexpectedly, Satria Mega 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 Satria Mega will offset losses from the drop in Satria Mega's long position.| Hotel Sahid vs. Pembangunan Jaya Ancol | Hotel Sahid vs. Panorama Sentrawisata Tbk | Hotel Sahid vs. Millennium Pharmacon International | Hotel Sahid vs. Tempo Inti Media |
| Satria Mega vs. Shield On Service | Satria Mega vs. MNC Studios International | Satria Mega vs. Royal Prima PT | Satria Mega vs. Sanurhasta Mitra PT |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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