Correlation Between Solusi Bangun and Citra Marga
Can any of the company-specific risk be diversified away by investing in both Solusi Bangun and Citra Marga 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 Solusi Bangun and Citra Marga into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Solusi Bangun Indonesia and Citra Marga Nusaphala, you can compare the effects of market volatilities on Solusi Bangun and Citra Marga 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 Solusi Bangun with a short position of Citra Marga. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solusi Bangun and Citra Marga.
Diversification Opportunities for Solusi Bangun and Citra Marga
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Solusi and Citra is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Solusi Bangun Indonesia and Citra Marga Nusaphala in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citra Marga Nusaphala and Solusi Bangun 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 Solusi Bangun Indonesia are associated (or correlated) with Citra Marga. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citra Marga Nusaphala has no effect on the direction of Solusi Bangun i.e., Solusi Bangun and Citra Marga go up and down completely randomly.
Pair Corralation between Solusi Bangun and Citra Marga
Assuming the 90 days trading horizon Solusi Bangun Indonesia is expected to under-perform the Citra Marga. But the stock apears to be less risky and, when comparing its historical volatility, Solusi Bangun Indonesia is 4.58 times less risky than Citra Marga. The stock trades about -0.04 of its potential returns per unit of risk. The Citra Marga Nusaphala is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 144,000 in Citra Marga Nusaphala on October 26, 2024 and sell it today you would earn a total of 253,000 from holding Citra Marga Nusaphala or generate 175.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Solusi Bangun Indonesia vs. Citra Marga Nusaphala
Performance |
| Timeline |
| Solusi Bangun Indonesia |
| Citra Marga Nusaphala |
Solusi Bangun and Citra Marga Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Solusi Bangun and Citra Marga
The main advantage of trading using opposite Solusi Bangun and Citra Marga positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solusi Bangun position performs unexpectedly, Citra Marga 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 Citra Marga will offset losses from the drop in Citra Marga's long position.| Solusi Bangun vs. Semen Indonesia Persero | Solusi Bangun vs. Indocement Tunggal Prakarsa | Solusi Bangun vs. Bakrie Sumatera Plantations | Solusi Bangun vs. Timah Persero Tbk |
| Citra Marga vs. Berlian Laju Tanker | Citra Marga vs. Solusi Bangun Indonesia | Citra Marga vs. Kawasan Industri Jababeka | Citra Marga vs. Mnc Investama 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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