Correlation Between PT Wintermar and PPHE HOTEL
Can any of the company-specific risk be diversified away by investing in both PT Wintermar and PPHE HOTEL 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 PT Wintermar and PPHE HOTEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Wintermar Offshore and PPHE HOTEL GROUP, you can compare the effects of market volatilities on PT Wintermar and PPHE HOTEL 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 PT Wintermar with a short position of PPHE HOTEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Wintermar and PPHE HOTEL.
Diversification Opportunities for PT Wintermar and PPHE HOTEL
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between W6O and PPHE is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding PT Wintermar Offshore and PPHE HOTEL GROUP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PPHE HOTEL GROUP and PT Wintermar 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 PT Wintermar Offshore are associated (or correlated) with PPHE HOTEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PPHE HOTEL GROUP has no effect on the direction of PT Wintermar i.e., PT Wintermar and PPHE HOTEL go up and down completely randomly.
Pair Corralation between PT Wintermar and PPHE HOTEL
Assuming the 90 days horizon PT Wintermar Offshore is expected to generate 6.24 times more return on investment than PPHE HOTEL. However, PT Wintermar is 6.24 times more volatile than PPHE HOTEL GROUP. It trades about 0.04 of its potential returns per unit of risk. PPHE HOTEL GROUP is currently generating about -0.01 per unit of risk. If you would invest 2.30 in PT Wintermar Offshore on October 12, 2024 and sell it today you would lose (0.15) from holding PT Wintermar Offshore or give up 6.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Wintermar Offshore vs. PPHE HOTEL GROUP
Performance |
| Timeline |
| PT Wintermar Offshore |
| PPHE HOTEL GROUP |
PT Wintermar and PPHE HOTEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Wintermar and PPHE HOTEL
The main advantage of trading using opposite PT Wintermar and PPHE HOTEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Wintermar position performs unexpectedly, PPHE HOTEL 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 PPHE HOTEL will offset losses from the drop in PPHE HOTEL's long position.| PT Wintermar vs. PPHE HOTEL GROUP | PT Wintermar vs. CarsalesCom | PT Wintermar vs. MHP Hotel AG | PT Wintermar vs. CITY OFFICE REIT |
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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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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