Correlation Between Surya Semesta and Summarecon Agung
Can any of the company-specific risk be diversified away by investing in both Surya Semesta and Summarecon Agung 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 Surya Semesta and Summarecon Agung into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Surya Semesta Internusa and Summarecon Agung Tbk, you can compare the effects of market volatilities on Surya Semesta and Summarecon Agung 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 Surya Semesta with a short position of Summarecon Agung. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surya Semesta and Summarecon Agung.
Diversification Opportunities for Surya Semesta and Summarecon Agung
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Surya and Summarecon is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Surya Semesta Internusa and Summarecon Agung Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Summarecon Agung Tbk and Surya Semesta 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 Surya Semesta Internusa are associated (or correlated) with Summarecon Agung. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Summarecon Agung Tbk has no effect on the direction of Surya Semesta i.e., Surya Semesta and Summarecon Agung go up and down completely randomly.
Pair Corralation between Surya Semesta and Summarecon Agung
Assuming the 90 days trading horizon Surya Semesta Internusa is expected to under-perform the Summarecon Agung. In addition to that, Surya Semesta is 1.13 times more volatile than Summarecon Agung Tbk. It trades about -0.34 of its total potential returns per unit of risk. Summarecon Agung Tbk is currently generating about -0.31 per unit of volatility. If you would invest 64,500 in Summarecon Agung Tbk on August 29, 2024 and sell it today you would lose (9,500) from holding Summarecon Agung Tbk or give up 14.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Surya Semesta Internusa vs. Summarecon Agung Tbk
Performance |
| Timeline |
| Surya Semesta Internusa |
| Summarecon Agung Tbk |
Surya Semesta and Summarecon Agung Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Surya Semesta and Summarecon Agung
The main advantage of trading using opposite Surya Semesta and Summarecon Agung positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Surya Semesta position performs unexpectedly, Summarecon Agung 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 Summarecon Agung will offset losses from the drop in Summarecon Agung's long position.The idea behind Surya Semesta Internusa and Summarecon Agung Tbk pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Summarecon Agung vs. Ciputra Development Tbk | Summarecon Agung vs. Bumi Serpong Damai | Summarecon Agung vs. Alam Sutera Realty | Summarecon Agung vs. Lippo Karawaci 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 Stocks Directory module to find actively traded stocks across global markets.
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