Correlation Between Satria Mega and Pt Pakuan
Can any of the company-specific risk be diversified away by investing in both Satria Mega and Pt Pakuan 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 Satria Mega and Pt Pakuan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Satria Mega Kencana and Pt Pakuan Tbk, you can compare the effects of market volatilities on Satria Mega and Pt Pakuan 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 Satria Mega with a short position of Pt Pakuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Satria Mega and Pt Pakuan.
Diversification Opportunities for Satria Mega and Pt Pakuan
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Satria and UANG is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Satria Mega Kencana and Pt Pakuan Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pt Pakuan Tbk and Satria Mega 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 Satria Mega Kencana are associated (or correlated) with Pt Pakuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pt Pakuan Tbk has no effect on the direction of Satria Mega i.e., Satria Mega and Pt Pakuan go up and down completely randomly.
Pair Corralation between Satria Mega and Pt Pakuan
Assuming the 90 days trading horizon Satria Mega Kencana is expected to generate 1.08 times more return on investment than Pt Pakuan. However, Satria Mega is 1.08 times more volatile than Pt Pakuan Tbk. It trades about 0.04 of its potential returns per unit of risk. Pt Pakuan Tbk is currently generating about 0.03 per unit of risk. If you would invest 30,400 in Satria Mega Kencana on August 27, 2024 and sell it today you would earn a total of 3,400 from holding Satria Mega Kencana or generate 11.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.54% |
| Values | Daily Returns |
Satria Mega Kencana vs. Pt Pakuan Tbk
Performance |
| Timeline |
| Satria Mega Kencana |
| Pt Pakuan Tbk |
Satria Mega and Pt Pakuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Satria Mega and Pt Pakuan
The main advantage of trading using opposite Satria Mega and Pt Pakuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Satria Mega position performs unexpectedly, Pt Pakuan 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 Pt Pakuan will offset losses from the drop in Pt Pakuan's long position.| Satria Mega vs. Jasa Armada Indonesia | Satria Mega vs. Cahayaputra Asa Keramik | Satria Mega vs. Campina Ice Cream |
| Pt Pakuan vs. Perintis Triniti Properti | Pt Pakuan vs. Satria Mega Kencana | Pt Pakuan vs. Sunindo Adipersada Tbk | Pt Pakuan vs. Jaya Sukses Makmur |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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