Correlation Between Jaya Swarasa and Trimegah Karya
Can any of the company-specific risk be diversified away by investing in both Jaya Swarasa and Trimegah Karya 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 Jaya Swarasa and Trimegah Karya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jaya Swarasa Agung and Trimegah Karya Pratama, you can compare the effects of market volatilities on Jaya Swarasa and Trimegah Karya 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 Jaya Swarasa with a short position of Trimegah Karya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jaya Swarasa and Trimegah Karya.
Diversification Opportunities for Jaya Swarasa and Trimegah Karya
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jaya and Trimegah is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Jaya Swarasa Agung and Trimegah Karya Pratama in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trimegah Karya Pratama and Jaya Swarasa 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 Jaya Swarasa Agung are associated (or correlated) with Trimegah Karya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trimegah Karya Pratama has no effect on the direction of Jaya Swarasa i.e., Jaya Swarasa and Trimegah Karya go up and down completely randomly.
Pair Corralation between Jaya Swarasa and Trimegah Karya
Assuming the 90 days trading horizon Jaya Swarasa Agung is expected to under-perform the Trimegah Karya. In addition to that, Jaya Swarasa is 1.2 times more volatile than Trimegah Karya Pratama. It trades about -0.06 of its total potential returns per unit of risk. Trimegah Karya Pratama is currently generating about -0.04 per unit of volatility. If you would invest 7,165 in Trimegah Karya Pratama on November 28, 2024 and sell it today you would lose (2,065) from holding Trimegah Karya Pratama or give up 28.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jaya Swarasa Agung vs. Trimegah Karya Pratama
Performance |
| Timeline |
| Jaya Swarasa Agung |
| Trimegah Karya Pratama |
Jaya Swarasa and Trimegah Karya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jaya Swarasa and Trimegah Karya
The main advantage of trading using opposite Jaya Swarasa and Trimegah Karya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jaya Swarasa position performs unexpectedly, Trimegah Karya 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 Trimegah Karya will offset losses from the drop in Trimegah Karya's long position.| Jaya Swarasa vs. Wahana Inti MakmurTbk | Jaya Swarasa vs. Formosa Ingredient Factory | Jaya Swarasa vs. Triputra Agro Persada | Jaya Swarasa vs. Cisarua Mountain Dairy |
| Trimegah Karya vs. Siloam International Hospitals | Trimegah Karya vs. Mahaka Media Tbk | Trimegah Karya vs. Garuda Metalindo Tbk | Trimegah Karya vs. Hero Supermarket 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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