Correlation Between Telkom Indonesia and New Ulm
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and New Ulm 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 New Ulm 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 New Ulm Telecom, you can compare the effects of market volatilities on Telkom Indonesia and New Ulm 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 New Ulm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and New Ulm.
Diversification Opportunities for Telkom Indonesia and New Ulm
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Telkom and New is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and New Ulm Telecom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New Ulm Telecom 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 New Ulm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New Ulm Telecom has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and New Ulm go up and down completely randomly.
Pair Corralation between Telkom Indonesia and New Ulm
Considering the 90-day investment horizon Telkom Indonesia Tbk is expected to under-perform the New Ulm. But the stock apears to be less risky and, when comparing its historical volatility, Telkom Indonesia Tbk is 2.03 times less risky than New Ulm. The stock trades about -0.06 of its potential returns per unit of risk. The New Ulm Telecom is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 875.00 in New Ulm Telecom on September 1, 2024 and sell it today you would lose (25.00) from holding New Ulm Telecom or give up 2.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Telkom Indonesia Tbk vs. New Ulm Telecom
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| New Ulm Telecom |
Telkom Indonesia and New Ulm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and New Ulm
The main advantage of trading using opposite Telkom Indonesia and New Ulm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, New Ulm 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 New Ulm will offset losses from the drop in New Ulm's long position.| Telkom Indonesia vs. T Mobile | Telkom Indonesia vs. Comcast Corp | Telkom Indonesia vs. Lumen Technologies | Telkom Indonesia vs. Charter Communications |
| New Ulm vs. HUMANA INC | New Ulm vs. Aquagold International | New Ulm vs. Barloworld Ltd ADR | New Ulm vs. Thrivent High Yield |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |