Correlation Between Scientific Games and Telkom Indonesia
Can any of the company-specific risk be diversified away by investing in both Scientific Games and Telkom Indonesia 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 Scientific Games and Telkom Indonesia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scientific Games and Telkom Indonesia Tbk, you can compare the effects of market volatilities on Scientific Games and Telkom Indonesia 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 Scientific Games with a short position of Telkom Indonesia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scientific Games and Telkom Indonesia.
Diversification Opportunities for Scientific Games and Telkom Indonesia
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Scientific and Telkom is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Scientific Games and Telkom Indonesia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telkom Indonesia Tbk and Scientific Games 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 Scientific Games are associated (or correlated) with Telkom Indonesia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telkom Indonesia Tbk has no effect on the direction of Scientific Games i.e., Scientific Games and Telkom Indonesia go up and down completely randomly.
Pair Corralation between Scientific Games and Telkom Indonesia
Assuming the 90 days horizon Scientific Games is expected to generate 0.31 times more return on investment than Telkom Indonesia. However, Scientific Games is 3.21 times less risky than Telkom Indonesia. It trades about 0.24 of its potential returns per unit of risk. Telkom Indonesia Tbk is currently generating about 0.02 per unit of risk. If you would invest 8,150 in Scientific Games on October 20, 2024 and sell it today you would earn a total of 400.00 from holding Scientific Games or generate 4.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scientific Games vs. Telkom Indonesia Tbk
Performance |
| Timeline |
| Scientific Games |
| Telkom Indonesia Tbk |
Scientific Games and Telkom Indonesia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scientific Games and Telkom Indonesia
The main advantage of trading using opposite Scientific Games and Telkom Indonesia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scientific Games position performs unexpectedly, Telkom Indonesia 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 Telkom Indonesia will offset losses from the drop in Telkom Indonesia's long position.| Scientific Games vs. Telecom Argentina SA | Scientific Games vs. UNIVERSAL MUSIC GROUP | Scientific Games vs. Chunghwa Telecom Co | Scientific Games vs. Taiwan Semiconductor Manufacturing |
| Telkom Indonesia vs. MOVIE GAMES SA | Telkom Indonesia vs. FRACTAL GAMING GROUP | Telkom Indonesia vs. PENN NATL GAMING | Telkom Indonesia vs. Scientific Games |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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