Correlation Between Telkom Indonesia and OPY Acquisition
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and OPY Acquisition 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 OPY Acquisition 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 OPY Acquisition I, you can compare the effects of market volatilities on Telkom Indonesia and OPY Acquisition 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 OPY Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and OPY Acquisition.
Diversification Opportunities for Telkom Indonesia and OPY Acquisition
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Telkom and OPY is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and OPY Acquisition I in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OPY Acquisition I 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 OPY Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OPY Acquisition I has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and OPY Acquisition go up and down completely randomly.
Pair Corralation between Telkom Indonesia and OPY Acquisition
If you would invest 996.00 in OPY Acquisition I on September 1, 2024 and sell it today you would earn a total of 0.00 from holding OPY Acquisition I or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 0.79% |
| Values | Daily Returns |
Telkom Indonesia Tbk vs. OPY Acquisition I
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| OPY Acquisition I |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Telkom Indonesia and OPY Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and OPY Acquisition
The main advantage of trading using opposite Telkom Indonesia and OPY Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, OPY Acquisition 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 OPY Acquisition will offset losses from the drop in OPY Acquisition'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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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