Correlation Between Gaya Abadi and DMS Propertindo
Can any of the company-specific risk be diversified away by investing in both Gaya Abadi and DMS Propertindo 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 DMS Propertindo 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 DMS Propertindo Tbk, you can compare the effects of market volatilities on Gaya Abadi and DMS Propertindo 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 DMS Propertindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaya Abadi and DMS Propertindo.
Diversification Opportunities for Gaya Abadi and DMS Propertindo
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Gaya and DMS is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Gaya Abadi Sempurna and DMS Propertindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DMS Propertindo Tbk 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 DMS Propertindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DMS Propertindo Tbk has no effect on the direction of Gaya Abadi i.e., Gaya Abadi and DMS Propertindo go up and down completely randomly.
Pair Corralation between Gaya Abadi and DMS Propertindo
Assuming the 90 days trading horizon Gaya Abadi Sempurna is expected to generate 0.85 times more return on investment than DMS Propertindo. However, Gaya Abadi Sempurna is 1.18 times less risky than DMS Propertindo. It trades about -0.08 of its potential returns per unit of risk. DMS Propertindo Tbk is currently generating about -0.07 per unit of risk. If you would invest 27,000 in Gaya Abadi Sempurna on August 28, 2024 and sell it today you would lose (22,000) from holding Gaya Abadi Sempurna or give up 81.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaya Abadi Sempurna vs. DMS Propertindo Tbk
Performance |
| Timeline |
| Gaya Abadi Sempurna |
| DMS Propertindo Tbk |
Gaya Abadi and DMS Propertindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaya Abadi and DMS Propertindo
The main advantage of trading using opposite Gaya Abadi and DMS Propertindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaya Abadi position performs unexpectedly, DMS Propertindo 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 DMS Propertindo will offset losses from the drop in DMS Propertindo's 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 |
| DMS Propertindo vs. Karya Bersama Anugerah | DMS Propertindo vs. Andalan Sakti Primaindo | DMS Propertindo vs. Perintis Triniti Properti | DMS Propertindo vs. Repower Asia Indonesia |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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