Correlation Between Trans Power and Pelayaran Nelly
Can any of the company-specific risk be diversified away by investing in both Trans Power and Pelayaran Nelly 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 Trans Power and Pelayaran Nelly into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trans Power Marine and Pelayaran Nelly Dwi, you can compare the effects of market volatilities on Trans Power and Pelayaran Nelly 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 Trans Power with a short position of Pelayaran Nelly. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trans Power and Pelayaran Nelly.
Diversification Opportunities for Trans Power and Pelayaran Nelly
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Trans and Pelayaran is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Trans Power Marine and Pelayaran Nelly Dwi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pelayaran Nelly Dwi and Trans Power 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 Trans Power Marine are associated (or correlated) with Pelayaran Nelly. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pelayaran Nelly Dwi has no effect on the direction of Trans Power i.e., Trans Power and Pelayaran Nelly go up and down completely randomly.
Pair Corralation between Trans Power and Pelayaran Nelly
Assuming the 90 days trading horizon Trans Power Marine is expected to generate 1.91 times more return on investment than Pelayaran Nelly. However, Trans Power is 1.91 times more volatile than Pelayaran Nelly Dwi. It trades about 0.02 of its potential returns per unit of risk. Pelayaran Nelly Dwi is currently generating about -0.02 per unit of risk. If you would invest 61,600 in Trans Power Marine on November 5, 2024 and sell it today you would earn a total of 1,400 from holding Trans Power Marine or generate 2.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trans Power Marine vs. Pelayaran Nelly Dwi
Performance |
| Timeline |
| Trans Power Marine |
| Pelayaran Nelly Dwi |
Trans Power and Pelayaran Nelly Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trans Power and Pelayaran Nelly
The main advantage of trading using opposite Trans Power and Pelayaran Nelly positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trans Power position performs unexpectedly, Pelayaran Nelly 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 Pelayaran Nelly will offset losses from the drop in Pelayaran Nelly's long position.| Trans Power vs. Pelayaran Nelly Dwi | Trans Power vs. Wintermar Offshore Marine | Trans Power vs. Pelita Samudera Shipping | Trans Power vs. Samudera Indonesia Tbk |
| Pelayaran Nelly vs. Trans Power Marine | Pelayaran Nelly vs. Pelita Samudera Shipping | Pelayaran Nelly vs. Samudera Indonesia Tbk | Pelayaran Nelly vs. Mitrabahtera Segara Sejati |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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