Correlation Between Telkom Indonesia and Torrent Capital
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and Torrent Capital 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 Torrent Capital 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 Torrent Capital, you can compare the effects of market volatilities on Telkom Indonesia and Torrent Capital 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 Torrent Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and Torrent Capital.
Diversification Opportunities for Telkom Indonesia and Torrent Capital
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Telkom and Torrent is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and Torrent Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Torrent Capital 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 Torrent Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Torrent Capital has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and Torrent Capital go up and down completely randomly.
Pair Corralation between Telkom Indonesia and Torrent Capital
If you would invest 1,612 in Telkom Indonesia Tbk on October 23, 2024 and sell it today you would earn a total of 36.00 from holding Telkom Indonesia Tbk or generate 2.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.0% |
| Values | Daily Returns |
Telkom Indonesia Tbk vs. Torrent Capital
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| Torrent Capital |
Telkom Indonesia and Torrent Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and Torrent Capital
The main advantage of trading using opposite Telkom Indonesia and Torrent Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, Torrent Capital 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 Torrent Capital will offset losses from the drop in Torrent Capital'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 |
| Torrent Capital vs. Nuveen Global High | Torrent Capital vs. New America High | Torrent Capital vs. Brookfield Business Corp | Torrent Capital vs. Elysee Development 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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