Correlation Between Terregra Asia and Jasnita Telekomindo
Can any of the company-specific risk be diversified away by investing in both Terregra Asia and Jasnita Telekomindo 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 Terregra Asia and Jasnita Telekomindo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Terregra Asia Energy and Jasnita Telekomindo Tbk, you can compare the effects of market volatilities on Terregra Asia and Jasnita Telekomindo 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 Terregra Asia with a short position of Jasnita Telekomindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Terregra Asia and Jasnita Telekomindo.
Diversification Opportunities for Terregra Asia and Jasnita Telekomindo
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Terregra and Jasnita is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Terregra Asia Energy and Jasnita Telekomindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jasnita Telekomindo Tbk and Terregra Asia 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 Terregra Asia Energy are associated (or correlated) with Jasnita Telekomindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jasnita Telekomindo Tbk has no effect on the direction of Terregra Asia i.e., Terregra Asia and Jasnita Telekomindo go up and down completely randomly.
Pair Corralation between Terregra Asia and Jasnita Telekomindo
Assuming the 90 days trading horizon Terregra Asia Energy is expected to generate 0.61 times more return on investment than Jasnita Telekomindo. However, Terregra Asia Energy is 1.63 times less risky than Jasnita Telekomindo. It trades about 0.57 of its potential returns per unit of risk. Jasnita Telekomindo Tbk is currently generating about 0.12 per unit of risk. If you would invest 2,600 in Terregra Asia Energy on October 24, 2024 and sell it today you would earn a total of 2,200 from holding Terregra Asia Energy or generate 84.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Terregra Asia Energy vs. Jasnita Telekomindo Tbk
Performance |
| Timeline |
| Terregra Asia Energy |
| Jasnita Telekomindo Tbk |
Terregra Asia and Jasnita Telekomindo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Terregra Asia and Jasnita Telekomindo
The main advantage of trading using opposite Terregra Asia and Jasnita Telekomindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Terregra Asia position performs unexpectedly, Jasnita Telekomindo 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 Jasnita Telekomindo will offset losses from the drop in Jasnita Telekomindo's long position.| Terregra Asia vs. Kapuas Prima Coal | Terregra Asia vs. Cikarang Listrindo Tbk | Terregra Asia vs. PP Presisi Tbk | Terregra Asia vs. Alfa Energi Investama |
| Jasnita Telekomindo vs. Borneo Olah Sarana | Jasnita Telekomindo vs. MNC Vision Networks | Jasnita Telekomindo vs. Alfa Energi Investama | Jasnita Telekomindo vs. Terregra Asia Energy |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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