Correlation Between PT Sreeya and Nusantara Infrastructure
Can any of the company-specific risk be diversified away by investing in both PT Sreeya and Nusantara Infrastructure 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 PT Sreeya and Nusantara Infrastructure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Sreeya Sewu and Nusantara Infrastructure Tbk, you can compare the effects of market volatilities on PT Sreeya and Nusantara Infrastructure 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 PT Sreeya with a short position of Nusantara Infrastructure. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Sreeya and Nusantara Infrastructure.
Diversification Opportunities for PT Sreeya and Nusantara Infrastructure
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SIPD and Nusantara is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding PT Sreeya Sewu and Nusantara Infrastructure Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nusantara Infrastructure and PT Sreeya 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 PT Sreeya Sewu are associated (or correlated) with Nusantara Infrastructure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nusantara Infrastructure has no effect on the direction of PT Sreeya i.e., PT Sreeya and Nusantara Infrastructure go up and down completely randomly.
Pair Corralation between PT Sreeya and Nusantara Infrastructure
Assuming the 90 days trading horizon PT Sreeya is expected to generate 7.68 times less return on investment than Nusantara Infrastructure. In addition to that, PT Sreeya is 1.12 times more volatile than Nusantara Infrastructure Tbk. It trades about 0.01 of its total potential returns per unit of risk. Nusantara Infrastructure Tbk is currently generating about 0.07 per unit of volatility. If you would invest 11,200 in Nusantara Infrastructure Tbk on August 31, 2024 and sell it today you would earn a total of 12,600 from holding Nusantara Infrastructure Tbk or generate 112.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.72% |
| Values | Daily Returns |
PT Sreeya Sewu vs. Nusantara Infrastructure Tbk
Performance |
| Timeline |
| PT Sreeya Sewu |
| Nusantara Infrastructure |
PT Sreeya and Nusantara Infrastructure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Sreeya and Nusantara Infrastructure
The main advantage of trading using opposite PT Sreeya and Nusantara Infrastructure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Sreeya position performs unexpectedly, Nusantara Infrastructure 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 Nusantara Infrastructure will offset losses from the drop in Nusantara Infrastructure's long position.| PT Sreeya vs. Central Proteina Prima | PT Sreeya vs. Kawasan Industri Jababeka | PT Sreeya vs. Tunas Baru Lampung | PT Sreeya vs. Slj Global 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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