Correlation Between T Mobile and PT Indosat
Can any of the company-specific risk be diversified away by investing in both T Mobile and PT Indosat 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 T Mobile and PT Indosat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between T Mobile and PT Indosat Tbk, you can compare the effects of market volatilities on T Mobile and PT Indosat 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 T Mobile with a short position of PT Indosat. Check out your portfolio center. Please also check ongoing floating volatility patterns of T Mobile and PT Indosat.
Diversification Opportunities for T Mobile and PT Indosat
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between TM5 and IDO1 is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding T Mobile and PT Indosat Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Indosat Tbk and T Mobile 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 T Mobile are associated (or correlated) with PT Indosat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Indosat Tbk has no effect on the direction of T Mobile i.e., T Mobile and PT Indosat go up and down completely randomly.
Pair Corralation between T Mobile and PT Indosat
Assuming the 90 days horizon T Mobile is expected to generate 0.2 times more return on investment than PT Indosat. However, T Mobile is 4.9 times less risky than PT Indosat. It trades about 0.13 of its potential returns per unit of risk. PT Indosat Tbk is currently generating about -0.02 per unit of risk. If you would invest 12,303 in T Mobile on September 12, 2024 and sell it today you would earn a total of 9,567 from holding T Mobile or generate 77.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
T Mobile vs. PT Indosat Tbk
Performance |
| Timeline |
| T Mobile |
| PT Indosat Tbk |
T Mobile and PT Indosat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with T Mobile and PT Indosat
The main advantage of trading using opposite T Mobile and PT Indosat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if T Mobile position performs unexpectedly, PT Indosat 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 PT Indosat will offset losses from the drop in PT Indosat's long position.| T Mobile vs. Geely Automobile Holdings | T Mobile vs. HF SINCLAIR P | T Mobile vs. GEELY AUTOMOBILE | T Mobile vs. ULTRA CLEAN HLDGS |
| PT Indosat vs. Superior Plus Corp | PT Indosat vs. SIVERS SEMICONDUCTORS AB | PT Indosat vs. Norsk Hydro ASA | PT Indosat vs. Reliance Steel Aluminum |
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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