Correlation Between PT Berkah and Buzzi Unicem

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

By analyzing existing cross correlation between PT Berkah Beton and Buzzi Unicem SpA, you can compare the effects of market volatilities on PT Berkah and Buzzi Unicem 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 PT Berkah with a short position of Buzzi Unicem. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Berkah and Buzzi Unicem.

Diversification Opportunities for PT Berkah and Buzzi Unicem

0.0

Correlation Coefficient

PT Berkah  Buzzi Unicem

Pay attention - limited upside

The 3 months correlation between BHBSY and Buzzi is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding PT Berkah Beton and Buzzi Unicem SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Buzzi Unicem SpA and PT Berkah 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 PT Berkah Beton are associated (or correlated) with Buzzi Unicem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Buzzi Unicem SpA has no effect on the direction of PT Berkah i.e., PT Berkah and Buzzi Unicem go up and down completely randomly.

Pair Corralation between PT Berkah and Buzzi Unicem

If you would invest  1,956  in Buzzi Unicem SpA on September 3, 2024 and sell it today you would earn a total of  142.00  from holding Buzzi Unicem SpA or generate 7.26% return on investment over 90 days.

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

PT Berkah Beton  vs.  Buzzi Unicem SpA

PT Berkah Beton

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PT Berkah Beton has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, PT Berkah is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Buzzi Unicem SpA

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Buzzi Unicem SpA are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, Buzzi Unicem may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with PT Berkah and Buzzi Unicem

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

The idea behind PT Berkah Beton and Buzzi Unicem SpA 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.