Correlation Between Sillo Maritime and Petrosea Tbk
Can any of the company-specific risk be diversified away by investing in both Sillo Maritime and Petrosea 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 Sillo Maritime and Petrosea Tbk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sillo Maritime Perdana and Petrosea Tbk, you can compare the effects of market volatilities on Sillo Maritime and Petrosea 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 Sillo Maritime with a short position of Petrosea Tbk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sillo Maritime and Petrosea Tbk.
Diversification Opportunities for Sillo Maritime and Petrosea Tbk
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sillo and Petrosea is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Sillo Maritime Perdana and Petrosea Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Petrosea Tbk and Sillo Maritime 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 Sillo Maritime Perdana are associated (or correlated) with Petrosea Tbk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Petrosea Tbk has no effect on the direction of Sillo Maritime i.e., Sillo Maritime and Petrosea Tbk go up and down completely randomly.
Pair Corralation between Sillo Maritime and Petrosea Tbk
Assuming the 90 days trading horizon Sillo Maritime is expected to generate 2.59 times less return on investment than Petrosea Tbk. But when comparing it to its historical volatility, Sillo Maritime Perdana is 1.54 times less risky than Petrosea Tbk. It trades about 0.13 of its potential returns per unit of risk. Petrosea Tbk is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,630,000 in Petrosea Tbk on August 28, 2024 and sell it today you would earn a total of 235,000 from holding Petrosea Tbk or generate 14.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sillo Maritime Perdana vs. Petrosea Tbk
Performance |
| Timeline |
| Sillo Maritime Perdana |
| Petrosea Tbk |
Sillo Maritime and Petrosea Tbk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sillo Maritime and Petrosea Tbk
The main advantage of trading using opposite Sillo Maritime and Petrosea Tbk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sillo Maritime position performs unexpectedly, Petrosea 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 Petrosea Tbk will offset losses from the drop in Petrosea Tbk's long position.| Sillo Maritime vs. Soechi Lines Tbk | Sillo Maritime vs. Samudera Indonesia Tbk | Sillo Maritime vs. Pelita Samudera Shipping | Sillo Maritime vs. Buana Listya Tama |
| Petrosea Tbk vs. Indika Energy Tbk | Petrosea Tbk vs. Harum Energy Tbk | Petrosea Tbk vs. Indo Tambangraya Megah | Petrosea Tbk vs. Gajah Tunggal 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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