Correlation Between Ciptadana Asset and Indonesian Tobacco
Can any of the company-specific risk be diversified away by investing in both Ciptadana Asset and Indonesian Tobacco 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 Ciptadana Asset and Indonesian Tobacco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ciptadana Asset Management and Indonesian Tobacco Tbk, you can compare the effects of market volatilities on Ciptadana Asset and Indonesian Tobacco 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 Ciptadana Asset with a short position of Indonesian Tobacco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ciptadana Asset and Indonesian Tobacco.
Diversification Opportunities for Ciptadana Asset and Indonesian Tobacco
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ciptadana and Indonesian is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Ciptadana Asset Management and Indonesian Tobacco Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indonesian Tobacco Tbk and Ciptadana Asset 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 Ciptadana Asset Management are associated (or correlated) with Indonesian Tobacco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indonesian Tobacco Tbk has no effect on the direction of Ciptadana Asset i.e., Ciptadana Asset and Indonesian Tobacco go up and down completely randomly.
Pair Corralation between Ciptadana Asset and Indonesian Tobacco
Assuming the 90 days trading horizon Ciptadana Asset Management is expected to generate 1.97 times more return on investment than Indonesian Tobacco. However, Ciptadana Asset is 1.97 times more volatile than Indonesian Tobacco Tbk. It trades about 0.03 of its potential returns per unit of risk. Indonesian Tobacco Tbk is currently generating about -0.08 per unit of risk. If you would invest 5,922 in Ciptadana Asset Management on September 1, 2024 and sell it today you would earn a total of 78.00 from holding Ciptadana Asset Management or generate 1.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ciptadana Asset Management vs. Indonesian Tobacco Tbk
Performance |
| Timeline |
| Ciptadana Asset Mana |
| Indonesian Tobacco Tbk |
Ciptadana Asset and Indonesian Tobacco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ciptadana Asset and Indonesian Tobacco
The main advantage of trading using opposite Ciptadana Asset and Indonesian Tobacco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ciptadana Asset position performs unexpectedly, Indonesian Tobacco 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 Indonesian Tobacco will offset losses from the drop in Indonesian Tobacco's long position.| Ciptadana Asset vs. Equity Development Investment | Ciptadana Asset vs. Gunawan Dianjaya Steel | Ciptadana Asset vs. Yelooo Integra Datanet | Ciptadana Asset vs. Hoffmen Cleanindo |
| Indonesian Tobacco vs. Wismilak Inti Makmur | Indonesian Tobacco vs. J Resources Asia | Indonesian Tobacco vs. Transcoal Pacific Tbk | Indonesian Tobacco vs. Garudafood Putra Putri |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |