Correlation Between Telkom Indonesia and Intel
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and Intel 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 Intel 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 Intel, you can compare the effects of market volatilities on Telkom Indonesia and Intel 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 Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and Intel.
Diversification Opportunities for Telkom Indonesia and Intel
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Telkom and Intel is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel 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 Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and Intel go up and down completely randomly.
Pair Corralation between Telkom Indonesia and Intel
Assuming the 90 days trading horizon Telkom Indonesia Tbk is expected to under-perform the Intel. In addition to that, Telkom Indonesia is 1.78 times more volatile than Intel. It trades about -0.02 of its total potential returns per unit of risk. Intel is currently generating about 0.23 per unit of volatility. If you would invest 2,040 in Intel on September 4, 2024 and sell it today you would earn a total of 343.00 from holding Intel or generate 16.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Telkom Indonesia Tbk vs. Intel
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| Intel |
Telkom Indonesia and Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and Intel
The main advantage of trading using opposite Telkom Indonesia and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.| Telkom Indonesia vs. G III Apparel Group | Telkom Indonesia vs. KIMBALL ELECTRONICS | Telkom Indonesia vs. Methode Electronics | Telkom Indonesia vs. Benchmark Electronics |
| Intel vs. Hochschild Mining plc | Intel vs. ANGLER GAMING PLC | Intel vs. PARKEN Sport Entertainment | Intel vs. Seven West Media |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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