Correlation Between Telkom Indonesia and SCOR SE
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and SCOR SE 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 SCOR SE 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 SCOR SE, you can compare the effects of market volatilities on Telkom Indonesia and SCOR SE 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 SCOR SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and SCOR SE.
Diversification Opportunities for Telkom Indonesia and SCOR SE
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Telkom and SCOR is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and SCOR SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCOR SE 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 SCOR SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCOR SE has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and SCOR SE go up and down completely randomly.
Pair Corralation between Telkom Indonesia and SCOR SE
Assuming the 90 days trading horizon Telkom Indonesia Tbk is expected to generate 2.62 times more return on investment than SCOR SE. However, Telkom Indonesia is 2.62 times more volatile than SCOR SE. It trades about 0.02 of its potential returns per unit of risk. SCOR SE is currently generating about -0.04 per unit of risk. If you would invest 19.00 in Telkom Indonesia Tbk on September 24, 2024 and sell it today you would lose (3.00) from holding Telkom Indonesia Tbk or give up 15.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telkom Indonesia Tbk vs. SCOR SE
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| SCOR SE |
Telkom Indonesia and SCOR SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and SCOR SE
The main advantage of trading using opposite Telkom Indonesia and SCOR SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, SCOR SE 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 SCOR SE will offset losses from the drop in SCOR SE's long position.| Telkom Indonesia vs. T Mobile | Telkom Indonesia vs. China Mobile Limited | Telkom Indonesia vs. Verizon Communications | Telkom Indonesia vs. ATT Inc |
| SCOR SE vs. MUENCHRUECKUNSADR 110 | SCOR SE vs. Swiss Re AG | SCOR SE vs. HANNRUECKVSE ADR 12ON | SCOR SE vs. Everest Group |
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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