Correlation Between Walmart and PT Sarana
Can any of the company-specific risk be diversified away by investing in both Walmart and PT Sarana 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 Walmart and PT Sarana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart and PT Sarana Menara, you can compare the effects of market volatilities on Walmart and PT Sarana 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 Walmart with a short position of PT Sarana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and PT Sarana.
Diversification Opportunities for Walmart and PT Sarana
Excellent diversification
The 3 months correlation between Walmart and SMNUF is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and PT Sarana Menara in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Sarana Menara and Walmart 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 Walmart are associated (or correlated) with PT Sarana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Sarana Menara has no effect on the direction of Walmart i.e., Walmart and PT Sarana go up and down completely randomly.
Pair Corralation between Walmart and PT Sarana
Considering the 90-day investment horizon Walmart is expected to generate 0.19 times more return on investment than PT Sarana. However, Walmart is 5.28 times less risky than PT Sarana. It trades about 0.2 of its potential returns per unit of risk. PT Sarana Menara is currently generating about -0.14 per unit of risk. If you would invest 5,902 in Walmart on August 25, 2024 and sell it today you would earn a total of 3,142 from holding Walmart or generate 53.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 29.47% |
| Values | Daily Returns |
Walmart vs. PT Sarana Menara
Performance |
| Timeline |
| Walmart |
| PT Sarana Menara |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Walmart and PT Sarana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and PT Sarana
The main advantage of trading using opposite Walmart and PT Sarana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, PT Sarana 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 PT Sarana will offset losses from the drop in PT Sarana's long position.| Walmart vs. Costco Wholesale Corp | Walmart vs. Dollar Tree | Walmart vs. BJs Wholesale Club | Walmart vs. Target |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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