Correlation Between Ciptadana Asset and Lautan Luas
Can any of the company-specific risk be diversified away by investing in both Ciptadana Asset and Lautan Luas 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 Lautan Luas 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 Lautan Luas Tbk, you can compare the effects of market volatilities on Ciptadana Asset and Lautan Luas 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 Lautan Luas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ciptadana Asset and Lautan Luas.
Diversification Opportunities for Ciptadana Asset and Lautan Luas
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Ciptadana and Lautan is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Ciptadana Asset Management and Lautan Luas Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lautan Luas 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 Lautan Luas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lautan Luas Tbk has no effect on the direction of Ciptadana Asset i.e., Ciptadana Asset and Lautan Luas go up and down completely randomly.
Pair Corralation between Ciptadana Asset and Lautan Luas
Assuming the 90 days trading horizon Ciptadana Asset Management is expected to generate 3.75 times more return on investment than Lautan Luas. However, Ciptadana Asset is 3.75 times more volatile than Lautan Luas Tbk. It trades about 0.03 of its potential returns per unit of risk. Lautan Luas Tbk is currently generating about -0.05 per unit of risk. If you would invest 5,724 in Ciptadana Asset Management on August 29, 2024 and sell it today you would earn a total of 76.00 from holding Ciptadana Asset Management or generate 1.33% 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. Lautan Luas Tbk
Performance |
| Timeline |
| Ciptadana Asset Mana |
| Lautan Luas Tbk |
Ciptadana Asset and Lautan Luas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ciptadana Asset and Lautan Luas
The main advantage of trading using opposite Ciptadana Asset and Lautan Luas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ciptadana Asset position performs unexpectedly, Lautan Luas 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 Lautan Luas will offset losses from the drop in Lautan Luas' long position.| Ciptadana Asset vs. Bank Central Asia | Ciptadana Asset vs. Bank Rakyat Indonesia | Ciptadana Asset vs. Bayan Resources Tbk | Ciptadana Asset vs. Bank Mandiri Persero |
| Lautan Luas vs. Dharma Polimetal Tbk | Lautan Luas vs. Alumindo Light Metal | Lautan Luas vs. Communication Cable Systems | Lautan Luas vs. Tridomain Performance Materials |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |