Correlation Between Telkom Indonesia and Lucy Scientific
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and Lucy Scientific 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 Lucy Scientific 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 Lucy Scientific Discovery, you can compare the effects of market volatilities on Telkom Indonesia and Lucy Scientific 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 Lucy Scientific. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and Lucy Scientific.
Diversification Opportunities for Telkom Indonesia and Lucy Scientific
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Telkom and Lucy is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and Lucy Scientific Discovery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lucy Scientific Discovery 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 Lucy Scientific. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lucy Scientific Discovery has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and Lucy Scientific go up and down completely randomly.
Pair Corralation between Telkom Indonesia and Lucy Scientific
If you would invest 1,641 in Telkom Indonesia Tbk on October 26, 2024 and sell it today you would earn a total of 58.00 from holding Telkom Indonesia Tbk or generate 3.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 5.26% |
| Values | Daily Returns |
Telkom Indonesia Tbk vs. Lucy Scientific Discovery
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| Lucy Scientific Discovery |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Telkom Indonesia and Lucy Scientific Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and Lucy Scientific
The main advantage of trading using opposite Telkom Indonesia and Lucy Scientific positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, Lucy Scientific 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 Lucy Scientific will offset losses from the drop in Lucy Scientific's long position.| Telkom Indonesia vs. Liberty Broadband Srs | Telkom Indonesia vs. Cable One | Telkom Indonesia vs. Liberty Broadband Corp | Telkom Indonesia vs. Liberty Global PLC |
| Lucy Scientific vs. Shuttle Pharmaceuticals | Lucy Scientific vs. Lifecore Biomedical | Lucy Scientific vs. Journey Medical Corp | Lucy Scientific vs. Akanda Corp |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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