Correlation Between Samudera Indonesia and Akr Corporindo
Can any of the company-specific risk be diversified away by investing in both Samudera Indonesia and Akr Corporindo 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 Samudera Indonesia and Akr Corporindo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samudera Indonesia Tbk and Akr Corporindo Tbk, you can compare the effects of market volatilities on Samudera Indonesia and Akr Corporindo 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 Samudera Indonesia with a short position of Akr Corporindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samudera Indonesia and Akr Corporindo.
Diversification Opportunities for Samudera Indonesia and Akr Corporindo
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samudera and Akr is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Samudera Indonesia Tbk and Akr Corporindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Akr Corporindo Tbk and Samudera Indonesia 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 Samudera Indonesia Tbk are associated (or correlated) with Akr Corporindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Akr Corporindo Tbk has no effect on the direction of Samudera Indonesia i.e., Samudera Indonesia and Akr Corporindo go up and down completely randomly.
Pair Corralation between Samudera Indonesia and Akr Corporindo
Assuming the 90 days trading horizon Samudera Indonesia Tbk is expected to under-perform the Akr Corporindo. In addition to that, Samudera Indonesia is 1.18 times more volatile than Akr Corporindo Tbk. It trades about -0.01 of its total potential returns per unit of risk. Akr Corporindo Tbk is currently generating about 0.02 per unit of volatility. If you would invest 117,956 in Akr Corporindo Tbk on August 28, 2024 and sell it today you would earn a total of 8,544 from holding Akr Corporindo Tbk or generate 7.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Samudera Indonesia Tbk vs. Akr Corporindo Tbk
Performance |
| Timeline |
| Samudera Indonesia Tbk |
| Akr Corporindo Tbk |
Samudera Indonesia and Akr Corporindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samudera Indonesia and Akr Corporindo
The main advantage of trading using opposite Samudera Indonesia and Akr Corporindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samudera Indonesia position performs unexpectedly, Akr Corporindo 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 Akr Corporindo will offset losses from the drop in Akr Corporindo's long position.| Samudera Indonesia vs. PT Temas Tbk | Samudera Indonesia vs. Petrosea Tbk | Samudera Indonesia vs. Rig Tenders Tbk | Samudera Indonesia vs. Rukun Raharja 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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