Correlation Between Weha Transportasi and Humpuss Intermoda
Can any of the company-specific risk be diversified away by investing in both Weha Transportasi and Humpuss Intermoda 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 Weha Transportasi and Humpuss Intermoda into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weha Transportasi Indonesia and Humpuss Intermoda Transportasi, you can compare the effects of market volatilities on Weha Transportasi and Humpuss Intermoda 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 Weha Transportasi with a short position of Humpuss Intermoda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weha Transportasi and Humpuss Intermoda.
Diversification Opportunities for Weha Transportasi and Humpuss Intermoda
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Weha and Humpuss is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Weha Transportasi Indonesia and Humpuss Intermoda Transportasi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humpuss Intermoda and Weha Transportasi 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 Weha Transportasi Indonesia are associated (or correlated) with Humpuss Intermoda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Humpuss Intermoda has no effect on the direction of Weha Transportasi i.e., Weha Transportasi and Humpuss Intermoda go up and down completely randomly.
Pair Corralation between Weha Transportasi and Humpuss Intermoda
Assuming the 90 days trading horizon Weha Transportasi Indonesia is expected to under-perform the Humpuss Intermoda. But the stock apears to be less risky and, when comparing its historical volatility, Weha Transportasi Indonesia is 1.57 times less risky than Humpuss Intermoda. The stock trades about -0.21 of its potential returns per unit of risk. The Humpuss Intermoda Transportasi is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 40,600 in Humpuss Intermoda Transportasi on September 3, 2024 and sell it today you would earn a total of 2,000 from holding Humpuss Intermoda Transportasi or generate 4.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weha Transportasi Indonesia vs. Humpuss Intermoda Transportasi
Performance |
| Timeline |
| Weha Transportasi |
| Humpuss Intermoda |
Weha Transportasi and Humpuss Intermoda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weha Transportasi and Humpuss Intermoda
The main advantage of trading using opposite Weha Transportasi and Humpuss Intermoda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weha Transportasi position performs unexpectedly, Humpuss Intermoda 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 Humpuss Intermoda will offset losses from the drop in Humpuss Intermoda's long position.| Weha Transportasi vs. Intanwijaya Internasional Tbk | Weha Transportasi vs. Champion Pacific Indonesia | Weha Transportasi vs. Mitra Pinasthika Mustika | Weha Transportasi vs. Jakarta Int Hotels |
| Humpuss Intermoda vs. Weha Transportasi Indonesia | Humpuss Intermoda vs. Mitra Pinasthika Mustika | Humpuss Intermoda vs. Jakarta Int Hotels | Humpuss Intermoda vs. Asuransi Harta Aman |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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