Correlation Between Weha Transportasi and Surya Toto
Can any of the company-specific risk be diversified away by investing in both Weha Transportasi and Surya Toto 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 Surya Toto 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 Surya Toto Indonesia, you can compare the effects of market volatilities on Weha Transportasi and Surya Toto 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 Surya Toto. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weha Transportasi and Surya Toto.
Diversification Opportunities for Weha Transportasi and Surya Toto
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Weha and Surya is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Weha Transportasi Indonesia and Surya Toto Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Surya Toto Indonesia 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 Surya Toto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Surya Toto Indonesia has no effect on the direction of Weha Transportasi i.e., Weha Transportasi and Surya Toto go up and down completely randomly.
Pair Corralation between Weha Transportasi and Surya Toto
Assuming the 90 days trading horizon Weha Transportasi Indonesia is expected to under-perform the Surya Toto. In addition to that, Weha Transportasi is 1.69 times more volatile than Surya Toto Indonesia. It trades about -0.37 of its total potential returns per unit of risk. Surya Toto Indonesia is currently generating about 0.23 per unit of volatility. If you would invest 21,071 in Surya Toto Indonesia on August 29, 2024 and sell it today you would earn a total of 1,529 from holding Surya Toto Indonesia or generate 7.26% 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. Surya Toto Indonesia
Performance |
| Timeline |
| Weha Transportasi |
| Surya Toto Indonesia |
Weha Transportasi and Surya Toto Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weha Transportasi and Surya Toto
The main advantage of trading using opposite Weha Transportasi and Surya Toto positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weha Transportasi position performs unexpectedly, Surya Toto 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 Surya Toto will offset losses from the drop in Surya Toto'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 |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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