Correlation Between Summarecon Agung and Agung Podomoro
Can any of the company-specific risk be diversified away by investing in both Summarecon Agung and Agung Podomoro 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 Summarecon Agung and Agung Podomoro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summarecon Agung Tbk and Agung Podomoro Land, you can compare the effects of market volatilities on Summarecon Agung and Agung Podomoro 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 Summarecon Agung with a short position of Agung Podomoro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summarecon Agung and Agung Podomoro.
Diversification Opportunities for Summarecon Agung and Agung Podomoro
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Summarecon and Agung is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Summarecon Agung Tbk and Agung Podomoro Land in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agung Podomoro Land and Summarecon Agung 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 Summarecon Agung Tbk are associated (or correlated) with Agung Podomoro. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agung Podomoro Land has no effect on the direction of Summarecon Agung i.e., Summarecon Agung and Agung Podomoro go up and down completely randomly.
Pair Corralation between Summarecon Agung and Agung Podomoro
Assuming the 90 days trading horizon Summarecon Agung Tbk is expected to generate 1.03 times more return on investment than Agung Podomoro. However, Summarecon Agung is 1.03 times more volatile than Agung Podomoro Land. It trades about -0.22 of its potential returns per unit of risk. Agung Podomoro Land is currently generating about -0.44 per unit of risk. If you would invest 64,500 in Summarecon Agung Tbk on August 28, 2024 and sell it today you would lose (7,000) from holding Summarecon Agung Tbk or give up 10.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Summarecon Agung Tbk vs. Agung Podomoro Land
Performance |
| Timeline |
| Summarecon Agung Tbk |
| Agung Podomoro Land |
Summarecon Agung and Agung Podomoro Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Summarecon Agung and Agung Podomoro
The main advantage of trading using opposite Summarecon Agung and Agung Podomoro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summarecon Agung position performs unexpectedly, Agung Podomoro 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 Agung Podomoro will offset losses from the drop in Agung Podomoro's long position.| Summarecon Agung vs. Ciputra Development Tbk | Summarecon Agung vs. Bumi Serpong Damai | Summarecon Agung vs. Alam Sutera Realty | Summarecon Agung vs. Lippo Karawaci Tbk |
| Agung Podomoro vs. Alam Sutera Realty | Agung Podomoro vs. Bumi Serpong Damai | Agung Podomoro vs. Summarecon Agung Tbk | Agung Podomoro vs. Ciputra Development 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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