Correlation Between Solusi Sinergi and Dow Jones
Can any of the company-specific risk be diversified away by investing in both Solusi Sinergi and Dow Jones 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 Solusi Sinergi and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Solusi Sinergi Digital and Dow Jones Industrial, you can compare the effects of market volatilities on Solusi Sinergi and Dow Jones 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 Solusi Sinergi with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of Solusi Sinergi and Dow Jones.
Diversification Opportunities for Solusi Sinergi and Dow Jones
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Solusi and Dow is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Solusi Sinergi Digital and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and Solusi Sinergi 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 Solusi Sinergi Digital are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of Solusi Sinergi i.e., Solusi Sinergi and Dow Jones go up and down completely randomly.
Pair Corralation between Solusi Sinergi and Dow Jones
Assuming the 90 days trading horizon Solusi Sinergi Digital is expected to generate 4.9 times more return on investment than Dow Jones. However, Solusi Sinergi is 4.9 times more volatile than Dow Jones Industrial. It trades about 0.09 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.11 per unit of risk. If you would invest 18,880 in Solusi Sinergi Digital on September 12, 2024 and sell it today you would earn a total of 22,920 from holding Solusi Sinergi Digital or generate 121.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 96.36% |
| Values | Daily Returns |
Solusi Sinergi Digital vs. Dow Jones Industrial
Performance |
| Timeline |
Solusi Sinergi and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
Solusi Sinergi Digital
Pair trading matchups for Solusi Sinergi
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with Solusi Sinergi and Dow Jones
The main advantage of trading using opposite Solusi Sinergi and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Solusi Sinergi position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| Solusi Sinergi vs. DCI Indonesia Tbk | Solusi Sinergi vs. Digital Mediatama Maxima | Solusi Sinergi vs. Multipolar Technology Tbk | Solusi Sinergi vs. Bank Net Indonesia |
| Dow Jones vs. Aeye Inc | Dow Jones vs. Gentex | Dow Jones vs. Marine Products | Dow Jones vs. CarsalesCom Ltd ADR |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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