Correlation Between Telkom Indonesia and Target Global
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and Target Global 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 Target Global 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 Target Global Acquisition, you can compare the effects of market volatilities on Telkom Indonesia and Target Global 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 Target Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and Target Global.
Diversification Opportunities for Telkom Indonesia and Target Global
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Telkom and Target is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and Target Global Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Target Global Acquisition 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 Target Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Target Global Acquisition has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and Target Global go up and down completely randomly.
Pair Corralation between Telkom Indonesia and Target Global
Considering the 90-day investment horizon Telkom Indonesia Tbk is expected to generate 26.92 times more return on investment than Target Global. However, Telkom Indonesia is 26.92 times more volatile than Target Global Acquisition. It trades about 0.19 of its potential returns per unit of risk. Target Global Acquisition is currently generating about 0.22 per unit of risk. If you would invest 1,553 in Telkom Indonesia Tbk on October 20, 2024 and sell it today you would earn a total of 95.00 from holding Telkom Indonesia Tbk or generate 6.12% 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. Target Global Acquisition
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| Target Global Acquisition |
Telkom Indonesia and Target Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and Target Global
The main advantage of trading using opposite Telkom Indonesia and Target Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, Target Global 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 Target Global will offset losses from the drop in Target Global'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 |
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 .
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