Correlation Between PT Sreeya and Slj Global
Can any of the company-specific risk be diversified away by investing in both PT Sreeya and Slj Global 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 Slj Global 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 Slj Global Tbk, you can compare the effects of market volatilities on PT Sreeya and Slj Global 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 Slj Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Sreeya and Slj Global.
Diversification Opportunities for PT Sreeya and Slj Global
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between SIPD and Slj is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding PT Sreeya Sewu and Slj Global Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Slj Global Tbk 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 Slj Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Slj Global Tbk has no effect on the direction of PT Sreeya i.e., PT Sreeya and Slj Global go up and down completely randomly.
Pair Corralation between PT Sreeya and Slj Global
Assuming the 90 days trading horizon PT Sreeya Sewu is expected to generate 1.53 times more return on investment than Slj Global. However, PT Sreeya is 1.53 times more volatile than Slj Global Tbk. It trades about -0.06 of its potential returns per unit of risk. Slj Global Tbk is currently generating about -0.19 per unit of risk. If you would invest 95,500 in PT Sreeya Sewu on August 28, 2024 and sell it today you would lose (9,000) from holding PT Sreeya Sewu or give up 9.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Sreeya Sewu vs. Slj Global Tbk
Performance |
| Timeline |
| PT Sreeya Sewu |
| Slj Global Tbk |
PT Sreeya and Slj Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Sreeya and Slj Global
The main advantage of trading using opposite PT Sreeya and Slj Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Sreeya position performs unexpectedly, Slj Global 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 Slj Global will offset losses from the drop in Slj Global's long position.The idea behind PT Sreeya Sewu and Slj Global Tbk pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Slj Global vs. Kedaung Indah Can | Slj Global vs. Langgeng Makmur Industri | Slj Global vs. Kabelindo Murni Tbk | Slj Global vs. Mustika Ratu 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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