Correlation Between Fks Multi and Sariguna Primatirta
Can any of the company-specific risk be diversified away by investing in both Fks Multi and Sariguna Primatirta 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 Fks Multi and Sariguna Primatirta into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fks Multi Agro and Sariguna Primatirta PT, you can compare the effects of market volatilities on Fks Multi and Sariguna Primatirta 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 Fks Multi with a short position of Sariguna Primatirta. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fks Multi and Sariguna Primatirta.
Diversification Opportunities for Fks Multi and Sariguna Primatirta
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Fks and Sariguna is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Fks Multi Agro and Sariguna Primatirta PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sariguna Primatirta and Fks Multi 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 Fks Multi Agro are associated (or correlated) with Sariguna Primatirta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sariguna Primatirta has no effect on the direction of Fks Multi i.e., Fks Multi and Sariguna Primatirta go up and down completely randomly.
Pair Corralation between Fks Multi and Sariguna Primatirta
Assuming the 90 days trading horizon Fks Multi Agro is expected to generate 1.53 times more return on investment than Sariguna Primatirta. However, Fks Multi is 1.53 times more volatile than Sariguna Primatirta PT. It trades about 0.14 of its potential returns per unit of risk. Sariguna Primatirta PT is currently generating about 0.08 per unit of risk. If you would invest 827,500 in Fks Multi Agro on September 24, 2024 and sell it today you would earn a total of 237,500 from holding Fks Multi Agro or generate 28.7% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 98.44% |
Values | Daily Returns |
Fks Multi Agro vs. Sariguna Primatirta PT
Performance |
Timeline |
Fks Multi Agro |
Sariguna Primatirta |
Fks Multi and Sariguna Primatirta Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Fks Multi and Sariguna Primatirta
The main advantage of trading using opposite Fks Multi and Sariguna Primatirta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fks Multi position performs unexpectedly, Sariguna Primatirta 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 Sariguna Primatirta will offset losses from the drop in Sariguna Primatirta's long position.Fks Multi vs. Sariguna Primatirta PT | Fks Multi vs. Ultra Jaya Milk | Fks Multi vs. Nippon Indosari Corpindo | Fks Multi vs. Kino Indonesia Tbk |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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