Correlation Between PT Temas and Total Bangun
Can any of the company-specific risk be diversified away by investing in both PT Temas and Total Bangun 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 PT Temas and Total Bangun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Temas Tbk and Total Bangun Persada, you can compare the effects of market volatilities on PT Temas and Total Bangun 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 PT Temas with a short position of Total Bangun. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Temas and Total Bangun.
Diversification Opportunities for PT Temas and Total Bangun
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between TMAS and Total is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding PT Temas Tbk and Total Bangun Persada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Total Bangun Persada and PT Temas 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 PT Temas Tbk are associated (or correlated) with Total Bangun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Total Bangun Persada has no effect on the direction of PT Temas i.e., PT Temas and Total Bangun go up and down completely randomly.
Pair Corralation between PT Temas and Total Bangun
Assuming the 90 days trading horizon PT Temas Tbk is expected to under-perform the Total Bangun. But the stock apears to be less risky and, when comparing its historical volatility, PT Temas Tbk is 2.78 times less risky than Total Bangun. The stock trades about -0.14 of its potential returns per unit of risk. The Total Bangun Persada is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 70,000 in Total Bangun Persada on August 25, 2024 and sell it today you would lose (1,500) from holding Total Bangun Persada or give up 2.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Temas Tbk vs. Total Bangun Persada
Performance |
| Timeline |
| PT Temas Tbk |
| Total Bangun Persada |
PT Temas and Total Bangun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Temas and Total Bangun
The main advantage of trading using opposite PT Temas and Total Bangun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Temas position performs unexpectedly, Total Bangun 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 Total Bangun will offset losses from the drop in Total Bangun's long position.| PT Temas vs. Samudera Indonesia Tbk | PT Temas vs. Weha Transportasi Indonesia | PT Temas vs. Rig Tenders Tbk | PT Temas vs. Total Bangun Persada |
| Total Bangun vs. Samudera Indonesia Tbk | Total Bangun vs. Rukun Raharja Tbk | Total Bangun vs. PT Temas Tbk | Total Bangun vs. Weha Transportasi Indonesia |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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