Correlation Between Super Energy and Sekar Bumi
Can any of the company-specific risk be diversified away by investing in both Super Energy and Sekar Bumi 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 Super Energy and Sekar Bumi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Super Energy Tbk and Sekar Bumi Tbk, you can compare the effects of market volatilities on Super Energy and Sekar Bumi 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 Super Energy with a short position of Sekar Bumi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Super Energy and Sekar Bumi.
Diversification Opportunities for Super Energy and Sekar Bumi
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Super and Sekar is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Super Energy Tbk and Sekar Bumi Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sekar Bumi Tbk and Super Energy 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 Super Energy Tbk are associated (or correlated) with Sekar Bumi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sekar Bumi Tbk has no effect on the direction of Super Energy i.e., Super Energy and Sekar Bumi go up and down completely randomly.
Pair Corralation between Super Energy and Sekar Bumi
Assuming the 90 days trading horizon Super Energy is expected to generate 8.52 times less return on investment than Sekar Bumi. But when comparing it to its historical volatility, Super Energy Tbk is 1.81 times less risky than Sekar Bumi. It trades about 0.02 of its potential returns per unit of risk. Sekar Bumi Tbk is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 23,800 in Sekar Bumi Tbk on August 31, 2024 and sell it today you would earn a total of 15,600 from holding Sekar Bumi Tbk or generate 65.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Super Energy Tbk vs. Sekar Bumi Tbk
Performance |
| Timeline |
| Super Energy Tbk |
| Sekar Bumi Tbk |
Super Energy and Sekar Bumi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Super Energy and Sekar Bumi
The main advantage of trading using opposite Super Energy and Sekar Bumi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Super Energy position performs unexpectedly, Sekar Bumi 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 Sekar Bumi will offset losses from the drop in Sekar Bumi's long position.| Super Energy vs. Transcoal Pacific Tbk | Super Energy vs. Sillo Maritime Perdana | Super Energy vs. Pollux Properti Indonesia | Super Energy vs. Mahkota Group Tbk |
| Sekar Bumi vs. Sekar Laut Tbk | Sekar Bumi vs. Siantar Top Tbk | Sekar Bumi vs. Prasidha Aneka Niaga | Sekar Bumi vs. Mandom Indonesia 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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