Correlation Between Triputra Agro and Puradelta Lestari
Can any of the company-specific risk be diversified away by investing in both Triputra Agro and Puradelta Lestari 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 Triputra Agro and Puradelta Lestari into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Triputra Agro Persada and Puradelta Lestari PT, you can compare the effects of market volatilities on Triputra Agro and Puradelta Lestari 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 Triputra Agro with a short position of Puradelta Lestari. Check out your portfolio center. Please also check ongoing floating volatility patterns of Triputra Agro and Puradelta Lestari.
Diversification Opportunities for Triputra Agro and Puradelta Lestari
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Triputra and Puradelta is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Triputra Agro Persada and Puradelta Lestari PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Puradelta Lestari and Triputra Agro 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 Triputra Agro Persada are associated (or correlated) with Puradelta Lestari. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Puradelta Lestari has no effect on the direction of Triputra Agro i.e., Triputra Agro and Puradelta Lestari go up and down completely randomly.
Pair Corralation between Triputra Agro and Puradelta Lestari
Assuming the 90 days trading horizon Triputra Agro Persada is expected to generate 1.97 times more return on investment than Puradelta Lestari. However, Triputra Agro is 1.97 times more volatile than Puradelta Lestari PT. It trades about 0.08 of its potential returns per unit of risk. Puradelta Lestari PT is currently generating about -0.01 per unit of risk. If you would invest 44,178 in Triputra Agro Persada on November 27, 2024 and sell it today you would earn a total of 33,322 from holding Triputra Agro Persada or generate 75.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.78% |
| Values | Daily Returns |
Triputra Agro Persada vs. Puradelta Lestari PT
Performance |
| Timeline |
| Triputra Agro Persada |
| Puradelta Lestari |
Triputra Agro and Puradelta Lestari Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Triputra Agro and Puradelta Lestari
The main advantage of trading using opposite Triputra Agro and Puradelta Lestari positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Triputra Agro position performs unexpectedly, Puradelta Lestari 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 Puradelta Lestari will offset losses from the drop in Puradelta Lestari's long position.| Triputra Agro vs. Dharma Satya Nusantara | Triputra Agro vs. Saratoga Investama Sedaya | Triputra Agro vs. Surya Esa Perkasa | Triputra Agro vs. Elang Mahkota Teknologi |
| Puradelta Lestari vs. Pakuwon Jati Tbk | Puradelta Lestari vs. Sido Muncul PT | Puradelta Lestari vs. Bekasi Fajar Industrial | Puradelta Lestari vs. Bank Pembangunan Timur |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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