Correlation Between Gaya Abadi and Habco Trans
Can any of the company-specific risk be diversified away by investing in both Gaya Abadi and Habco Trans 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 Gaya Abadi and Habco Trans into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaya Abadi Sempurna and Habco Trans Maritima, you can compare the effects of market volatilities on Gaya Abadi and Habco Trans 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 Gaya Abadi with a short position of Habco Trans. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaya Abadi and Habco Trans.
Diversification Opportunities for Gaya Abadi and Habco Trans
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gaya and Habco is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Gaya Abadi Sempurna and Habco Trans Maritima in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Habco Trans Maritima and Gaya Abadi 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 Gaya Abadi Sempurna are associated (or correlated) with Habco Trans. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Habco Trans Maritima has no effect on the direction of Gaya Abadi i.e., Gaya Abadi and Habco Trans go up and down completely randomly.
Pair Corralation between Gaya Abadi and Habco Trans
Assuming the 90 days trading horizon Gaya Abadi Sempurna is expected to under-perform the Habco Trans. In addition to that, Gaya Abadi is 1.15 times more volatile than Habco Trans Maritima. It trades about -0.07 of its total potential returns per unit of risk. Habco Trans Maritima is currently generating about 0.01 per unit of volatility. If you would invest 33,989 in Habco Trans Maritima on August 28, 2024 and sell it today you would lose (5,389) from holding Habco Trans Maritima or give up 15.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaya Abadi Sempurna vs. Habco Trans Maritima
Performance |
| Timeline |
| Gaya Abadi Sempurna |
| Habco Trans Maritima |
Gaya Abadi and Habco Trans Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaya Abadi and Habco Trans
The main advantage of trading using opposite Gaya Abadi and Habco Trans positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaya Abadi position performs unexpectedly, Habco Trans 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 Habco Trans will offset losses from the drop in Habco Trans' long position.| Gaya Abadi vs. Multipolar Technology Tbk | Gaya Abadi vs. Nusantara Voucher Distribution | Gaya Abadi vs. Hensel Davest Indonesia | Gaya Abadi vs. Anabatic Technologies 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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