Correlation Between Trias Sentosa and Panin Financial
Can any of the company-specific risk be diversified away by investing in both Trias Sentosa and Panin Financial 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 Trias Sentosa and Panin Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trias Sentosa Tbk and Panin Financial Tbk, you can compare the effects of market volatilities on Trias Sentosa and Panin Financial 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 Trias Sentosa with a short position of Panin Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trias Sentosa and Panin Financial.
Diversification Opportunities for Trias Sentosa and Panin Financial
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Trias and Panin is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Trias Sentosa Tbk and Panin Financial Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Panin Financial Tbk and Trias Sentosa 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 Trias Sentosa Tbk are associated (or correlated) with Panin Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Panin Financial Tbk has no effect on the direction of Trias Sentosa i.e., Trias Sentosa and Panin Financial go up and down completely randomly.
Pair Corralation between Trias Sentosa and Panin Financial
Assuming the 90 days trading horizon Trias Sentosa is expected to generate 2.72 times less return on investment than Panin Financial. But when comparing it to its historical volatility, Trias Sentosa Tbk is 1.23 times less risky than Panin Financial. It trades about 0.02 of its potential returns per unit of risk. Panin Financial Tbk is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 26,400 in Panin Financial Tbk on December 11, 2024 and sell it today you would earn a total of 7,600 from holding Panin Financial Tbk or generate 28.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Trias Sentosa Tbk vs. Panin Financial Tbk
Performance |
| Timeline |
| Trias Sentosa Tbk |
| Panin Financial Tbk |
Trias Sentosa and Panin Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Trias Sentosa and Panin Financial
The main advantage of trading using opposite Trias Sentosa and Panin Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trias Sentosa position performs unexpectedly, Panin Financial 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 Panin Financial will offset losses from the drop in Panin Financial's long position.| Trias Sentosa vs. Argha Karya Prima | ||
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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