Correlation Between Liberty Broadband and PT Indosat
Can any of the company-specific risk be diversified away by investing in both Liberty Broadband and PT Indosat 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 Liberty Broadband and PT Indosat into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liberty Broadband Srs and PT Indosat Tbk, you can compare the effects of market volatilities on Liberty Broadband and PT Indosat 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 Liberty Broadband with a short position of PT Indosat. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty Broadband and PT Indosat.
Diversification Opportunities for Liberty Broadband and PT Indosat
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Liberty and PTITF is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Broadband Srs and PT Indosat Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Indosat Tbk and Liberty Broadband 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 Liberty Broadband Srs are associated (or correlated) with PT Indosat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Indosat Tbk has no effect on the direction of Liberty Broadband i.e., Liberty Broadband and PT Indosat go up and down completely randomly.
Pair Corralation between Liberty Broadband and PT Indosat
Assuming the 90 days horizon Liberty Broadband Srs is expected to generate 0.31 times more return on investment than PT Indosat. However, Liberty Broadband Srs is 3.26 times less risky than PT Indosat. It trades about 0.02 of its potential returns per unit of risk. PT Indosat Tbk is currently generating about -0.14 per unit of risk. If you would invest 7,517 in Liberty Broadband Srs on September 26, 2024 and sell it today you would earn a total of 67.00 from holding Liberty Broadband Srs or generate 0.89% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Liberty Broadband Srs vs. PT Indosat Tbk
Performance |
Timeline |
Liberty Broadband Srs |
PT Indosat Tbk |
Liberty Broadband and PT Indosat Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Liberty Broadband and PT Indosat
The main advantage of trading using opposite Liberty Broadband and PT Indosat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liberty Broadband position performs unexpectedly, PT Indosat 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 Indosat will offset losses from the drop in PT Indosat's long position.Liberty Broadband vs. Liberty Global PLC | Liberty Broadband vs. Liberty Global PLC | Liberty Broadband vs. Shenandoah Telecommunications Co | Liberty Broadband vs. Liberty Global PLC |
PT Indosat vs. Liberty Broadband Srs | PT Indosat vs. ATN International | PT Indosat vs. Shenandoah Telecommunications Co | PT Indosat vs. KT Corporation |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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