Correlation Between Sawit Sumbermas and Kalbe Farma
Can any of the company-specific risk be diversified away by investing in both Sawit Sumbermas and Kalbe Farma 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 Sawit Sumbermas and Kalbe Farma into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sawit Sumbermas Sarana and Kalbe Farma Tbk, you can compare the effects of market volatilities on Sawit Sumbermas and Kalbe Farma 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 Sawit Sumbermas with a short position of Kalbe Farma. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sawit Sumbermas and Kalbe Farma.
Diversification Opportunities for Sawit Sumbermas and Kalbe Farma
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sawit and Kalbe is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Sawit Sumbermas Sarana and Kalbe Farma Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kalbe Farma Tbk and Sawit Sumbermas 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 Sawit Sumbermas Sarana are associated (or correlated) with Kalbe Farma. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kalbe Farma Tbk has no effect on the direction of Sawit Sumbermas i.e., Sawit Sumbermas and Kalbe Farma go up and down completely randomly.
Pair Corralation between Sawit Sumbermas and Kalbe Farma
Assuming the 90 days trading horizon Sawit Sumbermas Sarana is expected to under-perform the Kalbe Farma. In addition to that, Sawit Sumbermas is 1.18 times more volatile than Kalbe Farma Tbk. It trades about -0.31 of its total potential returns per unit of risk. Kalbe Farma Tbk is currently generating about -0.25 per unit of volatility. If you would invest 161,500 in Kalbe Farma Tbk on August 30, 2024 and sell it today you would lose (13,500) from holding Kalbe Farma Tbk or give up 8.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sawit Sumbermas Sarana vs. Kalbe Farma Tbk
Performance |
| Timeline |
| Sawit Sumbermas Sarana |
| Kalbe Farma Tbk |
Sawit Sumbermas and Kalbe Farma Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sawit Sumbermas and Kalbe Farma
The main advantage of trading using opposite Sawit Sumbermas and Kalbe Farma positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sawit Sumbermas position performs unexpectedly, Kalbe Farma 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 Kalbe Farma will offset losses from the drop in Kalbe Farma's long position.| Sawit Sumbermas vs. Bakrieland Development Tbk | Sawit Sumbermas vs. Bakrie Brothers Tbk | Sawit Sumbermas vs. Energi Mega Persada | Sawit Sumbermas vs. Sampoerna Agro Tbk |
| Kalbe Farma vs. Merdeka Copper Gold | Kalbe Farma vs. Tower Bersama Infrastructure | Kalbe Farma vs. Erajaya Swasembada Tbk | Kalbe Farma vs. Surya Citra Media |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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