Correlation Between Widodo Makmur and Habco Trans
Can any of the company-specific risk be diversified away by investing in both Widodo Makmur and Habco Trans 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 Widodo Makmur and Habco Trans into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Widodo Makmur Unggas and Habco Trans Maritima, you can compare the effects of market volatilities on Widodo Makmur and Habco Trans 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 Widodo Makmur with a short position of Habco Trans. Check out your portfolio center. Please also check ongoing floating volatility patterns of Widodo Makmur and Habco Trans.
Diversification Opportunities for Widodo Makmur and Habco Trans
-0.15 | Correlation Coefficient |
Good diversification
The 3 months correlation between Widodo and Habco is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Widodo Makmur Unggas and Habco Trans Maritima in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Habco Trans Maritima and Widodo Makmur 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 Widodo Makmur Unggas are associated (or correlated) with Habco Trans. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Habco Trans Maritima has no effect on the direction of Widodo Makmur i.e., Widodo Makmur and Habco Trans go up and down completely randomly.
Pair Corralation between Widodo Makmur and Habco Trans
Assuming the 90 days trading horizon Widodo Makmur Unggas is expected to generate 1.71 times more return on investment than Habco Trans. However, Widodo Makmur is 1.71 times more volatile than Habco Trans Maritima. It trades about 0.03 of its potential returns per unit of risk. Habco Trans Maritima is currently generating about -0.07 per unit of risk. If you would invest 1,100 in Widodo Makmur Unggas on September 2, 2024 and sell it today you would earn a total of 0.00 from holding Widodo Makmur Unggas or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Widodo Makmur Unggas vs. Habco Trans Maritima
Performance |
| Timeline |
| Widodo Makmur Unggas |
| Habco Trans Maritima |
Widodo Makmur and Habco Trans Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Widodo Makmur and Habco Trans
The main advantage of trading using opposite Widodo Makmur and Habco Trans positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Widodo Makmur position performs unexpectedly, Habco Trans 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 Habco Trans will offset losses from the drop in Habco Trans' long position.| Widodo Makmur vs. Habco Trans Maritima | Widodo Makmur vs. PT Cilacap Samudera | Widodo Makmur vs. PT Sari Kreasi | Widodo Makmur vs. Autopedia Sukses Lestari |
| Habco Trans vs. Transcoal Pacific Tbk | Habco Trans vs. PT Temas Tbk | Habco Trans vs. Samudera Indonesia Tbk | Habco Trans vs. Pelita Samudera Shipping |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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