Correlation Between Pelayaran Nasional and PT Trimuda

Can any of the company-specific risk be diversified away by investing in both Pelayaran Nasional and PT Trimuda 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 Pelayaran Nasional and PT Trimuda into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Pelayaran Nasional Bina and PT Trimuda Nuansa, you can compare the effects of market volatilities on Pelayaran Nasional and PT Trimuda 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 Pelayaran Nasional with a short position of PT Trimuda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pelayaran Nasional and PT Trimuda.

Diversification Opportunities for Pelayaran Nasional and PT Trimuda

0.64

Correlation Coefficient

Pelayaran Nasional  PT Trimuda

Poor diversification

The 3 months correlation between Pelayaran and TNCA is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Pelayaran Nasional Bina and PT Trimuda Nuansa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Trimuda Nuansa and Pelayaran Nasional 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 Pelayaran Nasional Bina are associated (or correlated) with PT Trimuda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Trimuda Nuansa has no effect on the direction of Pelayaran Nasional i.e., Pelayaran Nasional and PT Trimuda go up and down completely randomly.

Pair Corralation between Pelayaran Nasional and PT Trimuda

Assuming the 90 days trading horizon Pelayaran Nasional Bina is expected to generate 0.28 times more return on investment than PT Trimuda. However, Pelayaran Nasional Bina is 3.61 times less risky than PT Trimuda. It trades about -0.03 of its potential returns per unit of risk. PT Trimuda Nuansa is currently generating about -0.08 per unit of risk. If you would invest  8,500  in Pelayaran Nasional Bina on September 16, 2024 and sell it today you would lose (500.00) from holding Pelayaran Nasional Bina or give up 5.88% of portfolio value over 90 days.

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

Pelayaran Nasional Bina  vs.  PT Trimuda Nuansa

Pelayaran Nasional Bina

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pelayaran Nasional Bina has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Pelayaran Nasional is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

PT Trimuda Nuansa

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PT Trimuda Nuansa has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in January 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Pelayaran Nasional and PT Trimuda

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

The idea behind Pelayaran Nasional Bina and PT Trimuda Nuansa 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.