Correlation Between Arkha Jayanti and Jasnita Telekomindo

Can any of the company-specific risk be diversified away by investing in both Arkha Jayanti and Jasnita Telekomindo 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 Arkha Jayanti and Jasnita Telekomindo into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Arkha Jayanti Persada and Jasnita Telekomindo Tbk, you can compare the effects of market volatilities on Arkha Jayanti and Jasnita Telekomindo 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 Arkha Jayanti with a short position of Jasnita Telekomindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arkha Jayanti and Jasnita Telekomindo.

Diversification Opportunities for Arkha Jayanti and Jasnita Telekomindo

-0.03

Correlation Coefficient

Arkha Jayanti  Jasnita Telekomindo

Good diversification

The 3 months correlation between Arkha and Jasnita is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Arkha Jayanti Persada and Jasnita Telekomindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jasnita Telekomindo Tbk and Arkha Jayanti 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 Arkha Jayanti Persada are associated (or correlated) with Jasnita Telekomindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jasnita Telekomindo Tbk has no effect on the direction of Arkha Jayanti i.e., Arkha Jayanti and Jasnita Telekomindo go up and down completely randomly.

Pair Corralation between Arkha Jayanti and Jasnita Telekomindo

Assuming the 90 days trading horizon Arkha Jayanti Persada is expected to generate 1.11 times more return on investment than Jasnita Telekomindo. However, Arkha Jayanti is 1.11 times more volatile than Jasnita Telekomindo Tbk. It trades about 0.22 of its potential returns per unit of risk. Jasnita Telekomindo Tbk is currently generating about 0.11 per unit of risk. If you would invest  1,500  in Arkha Jayanti Persada on September 29, 2024 and sell it today you would earn a total of  1,400  from holding Arkha Jayanti Persada or generate 93.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Arkha Jayanti Persada  vs.  Jasnita Telekomindo Tbk

Arkha Jayanti Persada

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Arkha Jayanti Persada are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Arkha Jayanti disclosed solid returns over the last few months and may actually be approaching a breakup point.

Jasnita Telekomindo Tbk

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Jasnita Telekomindo Tbk are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Jasnita Telekomindo disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Arkha Jayanti and Jasnita Telekomindo

The main advantage of trading using opposite Arkha Jayanti and Jasnita Telekomindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arkha Jayanti position performs unexpectedly, Jasnita Telekomindo 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 Jasnita Telekomindo will offset losses from the drop in Jasnita Telekomindo's long position.

The idea behind Arkha Jayanti Persada and Jasnita Telekomindo Tbk pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.