Correlation Between Telkom Indonesia and Gouverneur Bancorp
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and Gouverneur Bancorp 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 Gouverneur Bancorp 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 Gouverneur Bancorp, you can compare the effects of market volatilities on Telkom Indonesia and Gouverneur Bancorp 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 Gouverneur Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and Gouverneur Bancorp.
Diversification Opportunities for Telkom Indonesia and Gouverneur Bancorp
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Telkom and Gouverneur is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and Gouverneur Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gouverneur Bancorp 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 Gouverneur Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gouverneur Bancorp has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and Gouverneur Bancorp go up and down completely randomly.
Pair Corralation between Telkom Indonesia and Gouverneur Bancorp
Considering the 90-day investment horizon Telkom Indonesia Tbk is expected to under-perform the Gouverneur Bancorp. In addition to that, Telkom Indonesia is 2.19 times more volatile than Gouverneur Bancorp. It trades about -0.06 of its total potential returns per unit of risk. Gouverneur Bancorp is currently generating about 0.45 per unit of volatility. If you would invest 1,117 in Gouverneur Bancorp on September 1, 2024 and sell it today you would earn a total of 104.00 from holding Gouverneur Bancorp or generate 9.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telkom Indonesia Tbk vs. Gouverneur Bancorp
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| Gouverneur Bancorp |
Telkom Indonesia and Gouverneur Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and Gouverneur Bancorp
The main advantage of trading using opposite Telkom Indonesia and Gouverneur Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, Gouverneur Bancorp 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 Gouverneur Bancorp will offset losses from the drop in Gouverneur Bancorp's long position.| Telkom Indonesia vs. T Mobile | Telkom Indonesia vs. Comcast Corp | Telkom Indonesia vs. Lumen Technologies | Telkom Indonesia vs. Charter Communications |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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