Correlation Between Unggul Indah and Suparma Tbk
Can any of the company-specific risk be diversified away by investing in both Unggul Indah and Suparma Tbk 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 Unggul Indah and Suparma Tbk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unggul Indah Cahaya and Suparma Tbk, you can compare the effects of market volatilities on Unggul Indah and Suparma Tbk 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 Unggul Indah with a short position of Suparma Tbk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unggul Indah and Suparma Tbk.
Diversification Opportunities for Unggul Indah and Suparma Tbk
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Unggul and Suparma is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Unggul Indah Cahaya and Suparma Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suparma Tbk and Unggul Indah 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 Unggul Indah Cahaya are associated (or correlated) with Suparma Tbk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suparma Tbk has no effect on the direction of Unggul Indah i.e., Unggul Indah and Suparma Tbk go up and down completely randomly.
Pair Corralation between Unggul Indah and Suparma Tbk
Assuming the 90 days trading horizon Unggul Indah Cahaya is expected to generate 0.81 times more return on investment than Suparma Tbk. However, Unggul Indah Cahaya is 1.23 times less risky than Suparma Tbk. It trades about -0.02 of its potential returns per unit of risk. Suparma Tbk is currently generating about -0.07 per unit of risk. If you would invest 886,118 in Unggul Indah Cahaya on November 27, 2024 and sell it today you would lose (126,118) from holding Unggul Indah Cahaya or give up 14.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Unggul Indah Cahaya vs. Suparma Tbk
Performance |
| Timeline |
| Unggul Indah Cahaya |
| Suparma Tbk |
Unggul Indah and Suparma Tbk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unggul Indah and Suparma Tbk
The main advantage of trading using opposite Unggul Indah and Suparma Tbk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unggul Indah position performs unexpectedly, Suparma Tbk 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 Suparma Tbk will offset losses from the drop in Suparma Tbk's long position.| Unggul Indah vs. Trias Sentosa Tbk | Unggul Indah vs. Suparma Tbk | Unggul Indah vs. Tembaga Mulia Semanan | Unggul Indah vs. Surya Toto Indonesia |
| Suparma Tbk vs. Trias Sentosa Tbk | Suparma Tbk vs. Slj Global Tbk | Suparma Tbk vs. PT Sreeya Sewu | Suparma Tbk vs. Indo Acidatama Tbk |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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