Correlation Between Timah Persero and Semen Baturaja
Can any of the company-specific risk be diversified away by investing in both Timah Persero and Semen Baturaja 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 Timah Persero and Semen Baturaja into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Timah Persero Tbk and Semen Baturaja Persero, you can compare the effects of market volatilities on Timah Persero and Semen Baturaja 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 Timah Persero with a short position of Semen Baturaja. Check out your portfolio center. Please also check ongoing floating volatility patterns of Timah Persero and Semen Baturaja.
Diversification Opportunities for Timah Persero and Semen Baturaja
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Timah and Semen is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Timah Persero Tbk and Semen Baturaja Persero in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Semen Baturaja Persero and Timah Persero 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 Timah Persero Tbk are associated (or correlated) with Semen Baturaja. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Semen Baturaja Persero has no effect on the direction of Timah Persero i.e., Timah Persero and Semen Baturaja go up and down completely randomly.
Pair Corralation between Timah Persero and Semen Baturaja
Assuming the 90 days trading horizon Timah Persero Tbk is expected to under-perform the Semen Baturaja. In addition to that, Timah Persero is 2.63 times more volatile than Semen Baturaja Persero. It trades about -0.16 of its total potential returns per unit of risk. Semen Baturaja Persero is currently generating about -0.02 per unit of volatility. If you would invest 22,400 in Semen Baturaja Persero on September 12, 2024 and sell it today you would lose (200.00) from holding Semen Baturaja Persero or give up 0.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Timah Persero Tbk vs. Semen Baturaja Persero
Performance |
| Timeline |
| Timah Persero Tbk |
| Semen Baturaja Persero |
Timah Persero and Semen Baturaja Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Timah Persero and Semen Baturaja
The main advantage of trading using opposite Timah Persero and Semen Baturaja positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Timah Persero position performs unexpectedly, Semen Baturaja 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 Semen Baturaja will offset losses from the drop in Semen Baturaja's long position.| Timah Persero vs. Vale Indonesia Tbk | Timah Persero vs. Aneka Tambang Persero | Timah Persero vs. Bukit Asam Tbk | Timah Persero vs. Perusahaan Gas Negara |
| Semen Baturaja vs. Kedaung Indah Can | Semen Baturaja vs. Kabelindo Murni Tbk | Semen Baturaja vs. Champion Pacific Indonesia | Semen Baturaja vs. Bhuwanatala Indah Permai |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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