Correlation Between Telkom Indonesia and FUJIFILM Holdings
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and FUJIFILM Holdings 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 Telkom Indonesia and FUJIFILM Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Telkom Indonesia Tbk and FUJIFILM Holdings, you can compare the effects of market volatilities on Telkom Indonesia and FUJIFILM Holdings 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 Telkom Indonesia with a short position of FUJIFILM Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and FUJIFILM Holdings.
Diversification Opportunities for Telkom Indonesia and FUJIFILM Holdings
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Telkom and FUJIFILM is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and FUJIFILM Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FUJIFILM Holdings and Telkom Indonesia 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 Telkom Indonesia Tbk are associated (or correlated) with FUJIFILM Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FUJIFILM Holdings has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and FUJIFILM Holdings go up and down completely randomly.
Pair Corralation between Telkom Indonesia and FUJIFILM Holdings
Assuming the 90 days trading horizon Telkom Indonesia is expected to generate 1.53 times less return on investment than FUJIFILM Holdings. In addition to that, Telkom Indonesia is 2.45 times more volatile than FUJIFILM Holdings. It trades about 0.02 of its total potential returns per unit of risk. FUJIFILM Holdings is currently generating about 0.07 per unit of volatility. If you would invest 1,491 in FUJIFILM Holdings on September 14, 2024 and sell it today you would earn a total of 622.00 from holding FUJIFILM Holdings or generate 41.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.64% |
| Values | Daily Returns |
Telkom Indonesia Tbk vs. FUJIFILM Holdings
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| FUJIFILM Holdings |
Telkom Indonesia and FUJIFILM Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and FUJIFILM Holdings
The main advantage of trading using opposite Telkom Indonesia and FUJIFILM Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, FUJIFILM Holdings 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 FUJIFILM Holdings will offset losses from the drop in FUJIFILM Holdings' long position.| Telkom Indonesia vs. AOYAMA TRADING | Telkom Indonesia vs. Citic Telecom International | Telkom Indonesia vs. HK Electric Investments | Telkom Indonesia vs. Gamma Communications plc |
| FUJIFILM Holdings vs. Avery Dennison Corp | FUJIFILM Holdings vs. Konica Minolta | FUJIFILM Holdings vs. KOKUYO LTD | FUJIFILM Holdings vs. Takkt AG |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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