Correlation Between Telkom Indonesia and Coronado Global
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and Coronado 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 Coronado 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 Coronado Global Resources, you can compare the effects of market volatilities on Telkom Indonesia and Coronado 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 Coronado Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and Coronado Global.
Diversification Opportunities for Telkom Indonesia and Coronado Global
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Telkom and Coronado is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and Coronado Global Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coronado Global Resources 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 Coronado Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coronado Global Resources has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and Coronado Global go up and down completely randomly.
Pair Corralation between Telkom Indonesia and Coronado Global
Assuming the 90 days horizon Telkom Indonesia Tbk is expected to generate 1.14 times more return on investment than Coronado Global. However, Telkom Indonesia is 1.14 times more volatile than Coronado Global Resources. It trades about -0.03 of its potential returns per unit of risk. Coronado Global Resources is currently generating about -0.09 per unit of risk. If you would invest 18.00 in Telkom Indonesia Tbk on October 25, 2024 and sell it today you would lose (2.00) from holding Telkom Indonesia Tbk or give up 11.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 92.19% |
| Values | Daily Returns |
Telkom Indonesia Tbk vs. Coronado Global Resources
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| Coronado Global Resources |
Telkom Indonesia and Coronado Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and Coronado Global
The main advantage of trading using opposite Telkom Indonesia and Coronado Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, Coronado 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 Coronado Global will offset losses from the drop in Coronado Global's long position.| Telkom Indonesia vs. Vodafone Group PLC | Telkom Indonesia vs. KDDI Corp | Telkom Indonesia vs. Amrica Mvil, SAB | Telkom Indonesia vs. Singapore Telecommunications Limited |
| Coronado Global vs. Alpha Metallurgical Resources | Coronado Global vs. Now Inc | Coronado Global vs. Oracle | Coronado Global vs. Tegna Inc |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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