Correlation Between Weha Transportasi and Nusa Raya
Can any of the company-specific risk be diversified away by investing in both Weha Transportasi and Nusa Raya 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 Nusa Raya 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 Nusa Raya Cipta, you can compare the effects of market volatilities on Weha Transportasi and Nusa Raya 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 Nusa Raya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weha Transportasi and Nusa Raya.
Diversification Opportunities for Weha Transportasi and Nusa Raya
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Weha and Nusa is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Weha Transportasi Indonesia and Nusa Raya Cipta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nusa Raya Cipta 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 Nusa Raya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nusa Raya Cipta has no effect on the direction of Weha Transportasi i.e., Weha Transportasi and Nusa Raya go up and down completely randomly.
Pair Corralation between Weha Transportasi and Nusa Raya
Assuming the 90 days trading horizon Weha Transportasi Indonesia is expected to generate 0.89 times more return on investment than Nusa Raya. However, Weha Transportasi Indonesia is 1.13 times less risky than Nusa Raya. It trades about -0.34 of its potential returns per unit of risk. Nusa Raya Cipta is currently generating about -0.36 per unit of risk. If you would invest 14,700 in Weha Transportasi Indonesia on September 1, 2024 and sell it today you would lose (2,400) from holding Weha Transportasi Indonesia or give up 16.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Weha Transportasi Indonesia vs. Nusa Raya Cipta
Performance |
| Timeline |
| Weha Transportasi |
| Nusa Raya Cipta |
Weha Transportasi and Nusa Raya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weha Transportasi and Nusa Raya
The main advantage of trading using opposite Weha Transportasi and Nusa Raya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weha Transportasi position performs unexpectedly, Nusa Raya 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 Nusa Raya will offset losses from the drop in Nusa Raya's long position.| Weha Transportasi vs. PT Temas Tbk | Weha Transportasi vs. Dosni Roha Indonesia | Weha Transportasi vs. Rig Tenders Tbk | Weha Transportasi vs. Samudera Indonesia Tbk |
| Nusa Raya vs. Total Bangun Persada | Nusa Raya vs. Surya Semesta Internusa | Nusa Raya vs. Acset Indonusa Tbk | Nusa Raya vs. Mitra Pinasthika Mustika |
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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