Correlation Between Siloam International and Buana Listya
Can any of the company-specific risk be diversified away by investing in both Siloam International and Buana Listya 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 Siloam International and Buana Listya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Siloam International Hospitals and Buana Listya Tama, you can compare the effects of market volatilities on Siloam International and Buana Listya 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 Siloam International with a short position of Buana Listya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Siloam International and Buana Listya.
Diversification Opportunities for Siloam International and Buana Listya
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Siloam and Buana is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Siloam International Hospitals and Buana Listya Tama in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Buana Listya Tama and Siloam International 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 Siloam International Hospitals are associated (or correlated) with Buana Listya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Buana Listya Tama has no effect on the direction of Siloam International i.e., Siloam International and Buana Listya go up and down completely randomly.
Pair Corralation between Siloam International and Buana Listya
Assuming the 90 days trading horizon Siloam International Hospitals is expected to generate 0.7 times more return on investment than Buana Listya. However, Siloam International Hospitals is 1.43 times less risky than Buana Listya. It trades about 0.06 of its potential returns per unit of risk. Buana Listya Tama is currently generating about 0.04 per unit of risk. If you would invest 194,463 in Siloam International Hospitals on September 12, 2024 and sell it today you would earn a total of 112,537 from holding Siloam International Hospitals or generate 57.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Siloam International Hospitals vs. Buana Listya Tama
Performance |
| Timeline |
| Siloam International |
| Buana Listya Tama |
Siloam International and Buana Listya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Siloam International and Buana Listya
The main advantage of trading using opposite Siloam International and Buana Listya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Siloam International position performs unexpectedly, Buana Listya 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 Buana Listya will offset losses from the drop in Buana Listya's long position.| Siloam International vs. Mitra Keluarga Karyasehat | Siloam International vs. Sumber Alfaria Trijaya | Siloam International vs. Elang Mahkota Teknologi |
| Buana Listya vs. Galva Technologies Tbk | Buana Listya vs. Trinitan Metals and | Buana Listya vs. Siloam International Hospitals | Buana Listya vs. PT UBC Medical |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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