Correlation Between Tower Bersama and Bekasi Fajar
Can any of the company-specific risk be diversified away by investing in both Tower Bersama and Bekasi Fajar 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 Tower Bersama and Bekasi Fajar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tower Bersama Infrastructure and Bekasi Fajar Industrial, you can compare the effects of market volatilities on Tower Bersama and Bekasi Fajar 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 Tower Bersama with a short position of Bekasi Fajar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tower Bersama and Bekasi Fajar.
Diversification Opportunities for Tower Bersama and Bekasi Fajar
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Tower and Bekasi is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Tower Bersama Infrastructure and Bekasi Fajar Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bekasi Fajar Industrial and Tower Bersama 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 Tower Bersama Infrastructure are associated (or correlated) with Bekasi Fajar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bekasi Fajar Industrial has no effect on the direction of Tower Bersama i.e., Tower Bersama and Bekasi Fajar go up and down completely randomly.
Pair Corralation between Tower Bersama and Bekasi Fajar
Assuming the 90 days trading horizon Tower Bersama Infrastructure is expected to generate 0.86 times more return on investment than Bekasi Fajar. However, Tower Bersama Infrastructure is 1.16 times less risky than Bekasi Fajar. It trades about -0.01 of its potential returns per unit of risk. Bekasi Fajar Industrial is currently generating about -0.02 per unit of risk. If you would invest 229,591 in Tower Bersama Infrastructure on August 25, 2024 and sell it today you would lose (36,591) from holding Tower Bersama Infrastructure or give up 15.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tower Bersama Infrastructure vs. Bekasi Fajar Industrial
Performance |
| Timeline |
| Tower Bersama Infras |
| Bekasi Fajar Industrial |
Tower Bersama and Bekasi Fajar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tower Bersama and Bekasi Fajar
The main advantage of trading using opposite Tower Bersama and Bekasi Fajar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tower Bersama position performs unexpectedly, Bekasi Fajar 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 Bekasi Fajar will offset losses from the drop in Bekasi Fajar's long position.| Tower Bersama vs. PT Sarana Menara | Tower Bersama vs. XL Axiata Tbk | Tower Bersama vs. Merdeka Copper Gold | Tower Bersama vs. Surya Citra Media |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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