Correlation Between TBS Energi and Saraswanti Anugerah
Can any of the company-specific risk be diversified away by investing in both TBS Energi and Saraswanti Anugerah 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 TBS Energi and Saraswanti Anugerah into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TBS Energi Utama and Saraswanti Anugerah Makmur, you can compare the effects of market volatilities on TBS Energi and Saraswanti Anugerah 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 TBS Energi with a short position of Saraswanti Anugerah. Check out your portfolio center. Please also check ongoing floating volatility patterns of TBS Energi and Saraswanti Anugerah.
Diversification Opportunities for TBS Energi and Saraswanti Anugerah
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between TBS and Saraswanti is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding TBS Energi Utama and Saraswanti Anugerah Makmur in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saraswanti Anugerah and TBS Energi 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 TBS Energi Utama are associated (or correlated) with Saraswanti Anugerah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saraswanti Anugerah has no effect on the direction of TBS Energi i.e., TBS Energi and Saraswanti Anugerah go up and down completely randomly.
Pair Corralation between TBS Energi and Saraswanti Anugerah
Assuming the 90 days trading horizon TBS Energi Utama is expected to under-perform the Saraswanti Anugerah. In addition to that, TBS Energi is 2.97 times more volatile than Saraswanti Anugerah Makmur. It trades about -0.19 of its total potential returns per unit of risk. Saraswanti Anugerah Makmur is currently generating about -0.19 per unit of volatility. If you would invest 80,000 in Saraswanti Anugerah Makmur on August 30, 2024 and sell it today you would lose (5,000) from holding Saraswanti Anugerah Makmur or give up 6.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
TBS Energi Utama vs. Saraswanti Anugerah Makmur
Performance |
| Timeline |
| TBS Energi Utama |
| Saraswanti Anugerah |
TBS Energi and Saraswanti Anugerah Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TBS Energi and Saraswanti Anugerah
The main advantage of trading using opposite TBS Energi and Saraswanti Anugerah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TBS Energi position performs unexpectedly, Saraswanti Anugerah 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 Saraswanti Anugerah will offset losses from the drop in Saraswanti Anugerah's long position.| TBS Energi vs. Golden Eagle Energy | TBS Energi vs. Baramulti Suksessarana Tbk | TBS Energi vs. Samindo Resources Tbk | TBS Energi vs. Resource Alam Indonesia |
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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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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