Correlation Between Telkom Indonesia and FG Merger
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and FG Merger 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 FG Merger 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 FG Merger Corp, you can compare the effects of market volatilities on Telkom Indonesia and FG Merger 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 FG Merger. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and FG Merger.
Diversification Opportunities for Telkom Indonesia and FG Merger
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Telkom and FGMCU is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and FG Merger Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FG Merger Corp 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 FG Merger. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FG Merger Corp has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and FG Merger go up and down completely randomly.
Pair Corralation between Telkom Indonesia and FG Merger
If you would invest 1,066 in FG Merger Corp on September 3, 2024 and sell it today you would earn a total of 0.00 from holding FG Merger Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 5.0% |
| Values | Daily Returns |
Telkom Indonesia Tbk vs. FG Merger Corp
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| FG Merger Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Telkom Indonesia and FG Merger Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and FG Merger
The main advantage of trading using opposite Telkom Indonesia and FG Merger positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, FG Merger 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 FG Merger will offset losses from the drop in FG Merger's long position.| Telkom Indonesia vs. Highway Holdings Limited | Telkom Indonesia vs. QCR Holdings | Telkom Indonesia vs. Partner Communications | Telkom Indonesia vs. Acumen Pharmaceuticals |
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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