Correlation Between Ulima Nitra and Fimperkasa Utama
Can any of the company-specific risk be diversified away by investing in both Ulima Nitra and Fimperkasa Utama 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 Ulima Nitra and Fimperkasa Utama into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ulima Nitra PT and Fimperkasa Utama Tbk, you can compare the effects of market volatilities on Ulima Nitra and Fimperkasa Utama 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 Ulima Nitra with a short position of Fimperkasa Utama. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ulima Nitra and Fimperkasa Utama.
Diversification Opportunities for Ulima Nitra and Fimperkasa Utama
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ulima and Fimperkasa is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Ulima Nitra PT and Fimperkasa Utama Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fimperkasa Utama Tbk and Ulima Nitra 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 Ulima Nitra PT are associated (or correlated) with Fimperkasa Utama. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fimperkasa Utama Tbk has no effect on the direction of Ulima Nitra i.e., Ulima Nitra and Fimperkasa Utama go up and down completely randomly.
Pair Corralation between Ulima Nitra and Fimperkasa Utama
Assuming the 90 days trading horizon Ulima Nitra PT is expected to generate 1.22 times more return on investment than Fimperkasa Utama. However, Ulima Nitra is 1.22 times more volatile than Fimperkasa Utama Tbk. It trades about 0.13 of its potential returns per unit of risk. Fimperkasa Utama Tbk is currently generating about -0.01 per unit of risk. If you would invest 6,032 in Ulima Nitra PT on August 30, 2024 and sell it today you would earn a total of 60,468 from holding Ulima Nitra PT or generate 1002.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Ulima Nitra PT vs. Fimperkasa Utama Tbk
Performance |
| Timeline |
| Ulima Nitra PT |
| Fimperkasa Utama Tbk |
Ulima Nitra and Fimperkasa Utama Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ulima Nitra and Fimperkasa Utama
The main advantage of trading using opposite Ulima Nitra and Fimperkasa Utama positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ulima Nitra position performs unexpectedly, Fimperkasa Utama 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 Fimperkasa Utama will offset losses from the drop in Fimperkasa Utama's long position.| Ulima Nitra vs. Widodo Makmur Unggas | Ulima Nitra vs. Borneo Olah Sarana | Ulima Nitra vs. PT Sunter Lakeside | Ulima Nitra vs. Era Mandiri Cemerlang |
| Fimperkasa Utama vs. Imago Mulia Persada | Fimperkasa Utama vs. Indonesia Pondasi Raya | Fimperkasa Utama vs. Ulima Nitra PT | Fimperkasa Utama vs. Indointernet Tbk PT |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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