Correlation Between Trimegah Karya and Lippo General
Can any of the company-specific risk be diversified away by investing in both Trimegah Karya and Lippo General 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 Trimegah Karya and Lippo General into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Trimegah Karya Pratama and Lippo General Insurance, you can compare the effects of market volatilities on Trimegah Karya and Lippo General 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 Trimegah Karya with a short position of Lippo General. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trimegah Karya and Lippo General.
Diversification Opportunities for Trimegah Karya and Lippo General
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Trimegah and Lippo is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Trimegah Karya Pratama and Lippo General Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lippo General Insurance and Trimegah Karya 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 Trimegah Karya Pratama are associated (or correlated) with Lippo General. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lippo General Insurance has no effect on the direction of Trimegah Karya i.e., Trimegah Karya and Lippo General go up and down completely randomly.
Pair Corralation between Trimegah Karya and Lippo General
Assuming the 90 days trading horizon Trimegah Karya Pratama is expected to under-perform the Lippo General. But the stock apears to be less risky and, when comparing its historical volatility, Trimegah Karya Pratama is 11.97 times less risky than Lippo General. The stock trades about -0.01 of its potential returns per unit of risk. The Lippo General Insurance is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 57,029 in Lippo General Insurance on September 2, 2024 and sell it today you would lose (20,229) from holding Lippo General Insurance or give up 35.47% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 99.79% |
Values | Daily Returns |
Trimegah Karya Pratama vs. Lippo General Insurance
Performance |
Timeline |
Trimegah Karya Pratama |
Lippo General Insurance |
Trimegah Karya and Lippo General Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Trimegah Karya and Lippo General
The main advantage of trading using opposite Trimegah Karya and Lippo General positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Trimegah Karya position performs unexpectedly, Lippo General 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 Lippo General will offset losses from the drop in Lippo General's long position.Trimegah Karya vs. Yelooo Integra Datanet | Trimegah Karya vs. Garuda Metalindo Tbk | Trimegah Karya vs. Tera Data Indonusa | Trimegah Karya vs. Pacific Strategic Financial |
Lippo General vs. Maskapai Reasuransi Indonesia | Lippo General vs. Lenox Pasifik Investama | Lippo General vs. Paninvest Tbk | Lippo General vs. Bank Mayapada Internasional |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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