Correlation Between Saratoga Investama and Menthobi Karyatama
Can any of the company-specific risk be diversified away by investing in both Saratoga Investama and Menthobi Karyatama 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 Saratoga Investama and Menthobi Karyatama into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saratoga Investama Sedaya and Menthobi Karyatama Raya, you can compare the effects of market volatilities on Saratoga Investama and Menthobi Karyatama 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 Saratoga Investama with a short position of Menthobi Karyatama. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saratoga Investama and Menthobi Karyatama.
Diversification Opportunities for Saratoga Investama and Menthobi Karyatama
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Saratoga and Menthobi is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Saratoga Investama Sedaya and Menthobi Karyatama Raya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Menthobi Karyatama Raya and Saratoga Investama 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 Saratoga Investama Sedaya are associated (or correlated) with Menthobi Karyatama. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Menthobi Karyatama Raya has no effect on the direction of Saratoga Investama i.e., Saratoga Investama and Menthobi Karyatama go up and down completely randomly.
Pair Corralation between Saratoga Investama and Menthobi Karyatama
Assuming the 90 days trading horizon Saratoga Investama Sedaya is expected to generate 0.83 times more return on investment than Menthobi Karyatama. However, Saratoga Investama Sedaya is 1.2 times less risky than Menthobi Karyatama. It trades about 0.02 of its potential returns per unit of risk. Menthobi Karyatama Raya is currently generating about 0.01 per unit of risk. If you would invest 220,407 in Saratoga Investama Sedaya on September 4, 2024 and sell it today you would earn a total of 18,593 from holding Saratoga Investama Sedaya or generate 8.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saratoga Investama Sedaya vs. Menthobi Karyatama Raya
Performance |
| Timeline |
| Saratoga Investama Sedaya |
| Menthobi Karyatama Raya |
Saratoga Investama and Menthobi Karyatama Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saratoga Investama and Menthobi Karyatama
The main advantage of trading using opposite Saratoga Investama and Menthobi Karyatama positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saratoga Investama position performs unexpectedly, Menthobi Karyatama 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 Menthobi Karyatama will offset losses from the drop in Menthobi Karyatama's long position.| Saratoga Investama vs. Paninvest Tbk | Saratoga Investama vs. Mitra Pinasthika Mustika | Saratoga Investama vs. Jakarta Int Hotels | Saratoga Investama vs. Asuransi Harta Aman |
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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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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