Correlation Between Intiland Development and Suryamas Dutamakmur

Can any of the company-specific risk be diversified away by investing in both Intiland Development and Suryamas Dutamakmur 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 Intiland Development and Suryamas Dutamakmur into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Intiland Development Tbk and Suryamas Dutamakmur Tbk, you can compare the effects of market volatilities on Intiland Development and Suryamas Dutamakmur 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 Intiland Development with a short position of Suryamas Dutamakmur. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intiland Development and Suryamas Dutamakmur.

Diversification Opportunities for Intiland Development and Suryamas Dutamakmur

-0.91

Correlation Coefficient

Intiland Development  Suryamas Dutamakmur

Pay attention - limited upside

The 3 months correlation between Intiland and Suryamas is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding Intiland Development Tbk and Suryamas Dutamakmur Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suryamas Dutamakmur Tbk and Intiland Development 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 Intiland Development Tbk are associated (or correlated) with Suryamas Dutamakmur. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suryamas Dutamakmur Tbk has no effect on the direction of Intiland Development i.e., Intiland Development and Suryamas Dutamakmur go up and down completely randomly.

Pair Corralation between Intiland Development and Suryamas Dutamakmur

Assuming the 90 days trading horizon Intiland Development Tbk is expected to under-perform the Suryamas Dutamakmur. In addition to that, Intiland Development is 2.14 times more volatile than Suryamas Dutamakmur Tbk. It trades about -0.31 of its total potential returns per unit of risk. Suryamas Dutamakmur Tbk is currently generating about 0.15 per unit of volatility. If you would invest  49,200  in Suryamas Dutamakmur Tbk on September 26, 2024 and sell it today you would earn a total of  3,300  from holding Suryamas Dutamakmur Tbk or generate 6.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	98.44%
Values	Daily Returns

Intiland Development Tbk  vs.  Suryamas Dutamakmur Tbk

Intiland Development Tbk

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intiland Development Tbk 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.

Suryamas Dutamakmur Tbk

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Suryamas Dutamakmur Tbk are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Suryamas Dutamakmur may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Intiland Development and Suryamas Dutamakmur

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

The idea behind Intiland Development Tbk and Suryamas Dutamakmur 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.