Correlation Between Unilever Indonesia and Panorama Sentrawisata
Can any of the company-specific risk be diversified away by investing in both Unilever Indonesia and Panorama Sentrawisata 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 Unilever Indonesia and Panorama Sentrawisata into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Unilever Indonesia Tbk and Panorama Sentrawisata Tbk, you can compare the effects of market volatilities on Unilever Indonesia and Panorama Sentrawisata 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 Unilever Indonesia with a short position of Panorama Sentrawisata. Check out your portfolio center. Please also check ongoing floating volatility patterns of Unilever Indonesia and Panorama Sentrawisata.
Diversification Opportunities for Unilever Indonesia and Panorama Sentrawisata
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Unilever and Panorama is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Unilever Indonesia Tbk and Panorama Sentrawisata Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Panorama Sentrawisata Tbk and Unilever Indonesia 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 Unilever Indonesia Tbk are associated (or correlated) with Panorama Sentrawisata. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Panorama Sentrawisata Tbk has no effect on the direction of Unilever Indonesia i.e., Unilever Indonesia and Panorama Sentrawisata go up and down completely randomly.
Pair Corralation between Unilever Indonesia and Panorama Sentrawisata
Assuming the 90 days trading horizon Unilever Indonesia Tbk is expected to under-perform the Panorama Sentrawisata. In addition to that, Unilever Indonesia is 1.13 times more volatile than Panorama Sentrawisata Tbk. It trades about -0.09 of its total potential returns per unit of risk. Panorama Sentrawisata Tbk is currently generating about -0.03 per unit of volatility. If you would invest 67,000 in Panorama Sentrawisata Tbk on September 1, 2024 and sell it today you would lose (13,000) from holding Panorama Sentrawisata Tbk or give up 19.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.61% |
| Values | Daily Returns |
Unilever Indonesia Tbk vs. Panorama Sentrawisata Tbk
Performance |
| Timeline |
| Unilever Indonesia Tbk |
| Panorama Sentrawisata Tbk |
Unilever Indonesia and Panorama Sentrawisata Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Unilever Indonesia and Panorama Sentrawisata
The main advantage of trading using opposite Unilever Indonesia and Panorama Sentrawisata positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Unilever Indonesia position performs unexpectedly, Panorama Sentrawisata 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 Panorama Sentrawisata will offset losses from the drop in Panorama Sentrawisata's long position.| Unilever Indonesia vs. PT Indofood Sukses | Unilever Indonesia vs. Astra International Tbk | Unilever Indonesia vs. Telkom Indonesia Tbk | Unilever Indonesia vs. Bank Central Asia |
| Panorama Sentrawisata vs. Pembangunan Jaya Ancol | Panorama Sentrawisata vs. Hotel Sahid Jaya | Panorama Sentrawisata vs. Pudjiadi Sons Tbk | Panorama Sentrawisata vs. Pioneerindo Gourmet International |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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