Correlation Between Vastland Indonesia and Hero Supermarket
Can any of the company-specific risk be diversified away by investing in both Vastland Indonesia and Hero Supermarket 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 Vastland Indonesia and Hero Supermarket into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vastland Indonesia and Hero Supermarket Tbk, you can compare the effects of market volatilities on Vastland Indonesia and Hero Supermarket 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 Vastland Indonesia with a short position of Hero Supermarket. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vastland Indonesia and Hero Supermarket.
Diversification Opportunities for Vastland Indonesia and Hero Supermarket
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Vastland and Hero is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Vastland Indonesia and Hero Supermarket Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hero Supermarket Tbk and Vastland 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 Vastland Indonesia are associated (or correlated) with Hero Supermarket. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hero Supermarket Tbk has no effect on the direction of Vastland Indonesia i.e., Vastland Indonesia and Hero Supermarket go up and down completely randomly.
Pair Corralation between Vastland Indonesia and Hero Supermarket
Assuming the 90 days trading horizon Vastland Indonesia is expected to generate 1.41 times more return on investment than Hero Supermarket. However, Vastland Indonesia is 1.41 times more volatile than Hero Supermarket Tbk. It trades about 0.0 of its potential returns per unit of risk. Hero Supermarket Tbk is currently generating about -0.07 per unit of risk. If you would invest 10,100 in Vastland Indonesia on September 4, 2024 and sell it today you would lose (2,700) from holding Vastland Indonesia or give up 26.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 91.54% |
| Values | Daily Returns |
Vastland Indonesia vs. Hero Supermarket Tbk
Performance |
| Timeline |
| Vastland Indonesia |
| Hero Supermarket Tbk |
Vastland Indonesia and Hero Supermarket Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vastland Indonesia and Hero Supermarket
The main advantage of trading using opposite Vastland Indonesia and Hero Supermarket positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vastland Indonesia position performs unexpectedly, Hero Supermarket 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 Hero Supermarket will offset losses from the drop in Hero Supermarket's long position.| Vastland Indonesia vs. Hero Supermarket Tbk | Vastland Indonesia vs. PT Bank Bisnis | Vastland Indonesia vs. Lotte Chemical Titan | Vastland Indonesia vs. Diamond Food Indonesia |
| Hero Supermarket vs. Fast Food Indonesia | Hero Supermarket vs. Enseval Putra Megatrading | Hero Supermarket vs. Matahari Putra Prima | Hero Supermarket vs. Hexindo Adiperkasa 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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