Correlation Between Telkom Indonesia and Quantgate Systems
Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and Quantgate Systems 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 Quantgate Systems 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 Quantgate Systems, you can compare the effects of market volatilities on Telkom Indonesia and Quantgate Systems 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 Quantgate Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and Quantgate Systems.
Diversification Opportunities for Telkom Indonesia and Quantgate Systems
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Telkom and Quantgate is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and Quantgate Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quantgate Systems 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 Quantgate Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quantgate Systems has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and Quantgate Systems go up and down completely randomly.
Pair Corralation between Telkom Indonesia and Quantgate Systems
Assuming the 90 days horizon Telkom Indonesia Tbk is expected to under-perform the Quantgate Systems. But the pink sheet apears to be less risky and, when comparing its historical volatility, Telkom Indonesia Tbk is 3.99 times less risky than Quantgate Systems. The pink sheet trades about -0.01 of its potential returns per unit of risk. The Quantgate Systems is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 3.10 in Quantgate Systems on November 2, 2024 and sell it today you would lose (0.38) from holding Quantgate Systems or give up 12.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 72.87% |
| Values | Daily Returns |
Telkom Indonesia Tbk vs. Quantgate Systems
Performance |
| Timeline |
| Telkom Indonesia Tbk |
| Quantgate Systems |
Telkom Indonesia and Quantgate Systems Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Telkom Indonesia and Quantgate Systems
The main advantage of trading using opposite Telkom Indonesia and Quantgate Systems positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, Quantgate Systems 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 Quantgate Systems will offset losses from the drop in Quantgate Systems' long position.| Telkom Indonesia vs. Magyar Telekom Plc | Telkom Indonesia vs. Singapore Telecommunications PK | Telkom Indonesia vs. Hellenic Telecommunications Org | Telkom Indonesia vs. Softbank Group Corp |
| Quantgate Systems vs. Ackroo Inc | Quantgate Systems vs. CurrentC Power | Quantgate Systems vs. Agent Information Software | Quantgate Systems vs. IGEN Networks 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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