Correlation Between Indosterling Technomedia and Steel Pipe
Can any of the company-specific risk be diversified away by investing in both Indosterling Technomedia and Steel Pipe 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 Indosterling Technomedia and Steel Pipe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Indosterling Technomedia Tbk and Steel Pipe Industry, you can compare the effects of market volatilities on Indosterling Technomedia and Steel Pipe 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 Indosterling Technomedia with a short position of Steel Pipe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indosterling Technomedia and Steel Pipe.
Diversification Opportunities for Indosterling Technomedia and Steel Pipe
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Indosterling and Steel is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Indosterling Technomedia Tbk and Steel Pipe Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Steel Pipe Industry and Indosterling Technomedia 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 Indosterling Technomedia Tbk are associated (or correlated) with Steel Pipe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Steel Pipe Industry has no effect on the direction of Indosterling Technomedia i.e., Indosterling Technomedia and Steel Pipe go up and down completely randomly.
Pair Corralation between Indosterling Technomedia and Steel Pipe
If you would invest 26,591 in Steel Pipe Industry on August 29, 2024 and sell it today you would earn a total of 1,809 from holding Steel Pipe Industry or generate 6.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Indosterling Technomedia Tbk vs. Steel Pipe Industry
Performance |
| Timeline |
| Indosterling Technomedia |
| Steel Pipe Industry |
Indosterling Technomedia and Steel Pipe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indosterling Technomedia and Steel Pipe
The main advantage of trading using opposite Indosterling Technomedia and Steel Pipe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indosterling Technomedia position performs unexpectedly, Steel Pipe 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 Steel Pipe will offset losses from the drop in Steel Pipe's long position.| Indosterling Technomedia vs. Multipolar Technology Tbk | Indosterling Technomedia vs. Digital Mediatama Maxima | Indosterling Technomedia vs. M Cash Integrasi | Indosterling Technomedia vs. NFC Indonesia PT |
| Steel Pipe vs. Barito Pacific Tbk | Steel Pipe vs. Charoen Pokphand Indonesia | Steel Pipe vs. Indocement Tunggal Prakarsa |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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