Correlation Between Telkom Indonesia and Liberty Broadband
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and Liberty Broadband 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 Liberty Broadband 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 Liberty Broadband Srs, you can compare the effects of market volatilities on Telkom Indonesia and Liberty Broadband 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 Liberty Broadband. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and Liberty Broadband.
Diversification Opportunities for Telkom Indonesia and Liberty Broadband
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Telkom and Liberty is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and Liberty Broadband Srs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liberty Broadband Srs 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 Liberty Broadband. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liberty Broadband Srs has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and Liberty Broadband go up and down completely randomly.
Pair Corralation between Telkom Indonesia and Liberty Broadband
Considering the 90-day investment horizon Telkom Indonesia Tbk is expected to under-perform the Liberty Broadband. But the stock apears to be less risky and, when comparing its historical volatility, Telkom Indonesia Tbk is 2.06 times less risky than Liberty Broadband. The stock trades about -0.08 of its potential returns per unit of risk. The Liberty Broadband Srs is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 8,294 in Liberty Broadband Srs on August 26, 2024 and sell it today you would earn a total of 335.00 from holding Liberty Broadband Srs or generate 4.04% 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. Liberty Broadband Srs
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| Liberty Broadband Srs |
Telkom Indonesia and Liberty Broadband Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and Liberty Broadband
The main advantage of trading using opposite Telkom Indonesia and Liberty Broadband positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, Liberty Broadband 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 Liberty Broadband will offset losses from the drop in Liberty Broadband's long position.| Telkom Indonesia vs. Liberty Broadband Srs | Telkom Indonesia vs. Ribbon Communications | Telkom Indonesia vs. Liberty Broadband Srs | Telkom Indonesia vs. Shenandoah Telecommunications Co |
| Liberty Broadband vs. KT Corporation | Liberty Broadband vs. Cable One | Liberty Broadband vs. Liberty Global PLC | Liberty Broadband vs. Liberty Latin America |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |