Correlation Between Pelayaran Nelly and Bintang Samudera

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

By analyzing existing cross correlation between Pelayaran Nelly Dwi and Bintang Samudera Mandiri, you can compare the effects of market volatilities on Pelayaran Nelly and Bintang Samudera 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 Nelly with a short position of Bintang Samudera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pelayaran Nelly and Bintang Samudera.

Diversification Opportunities for Pelayaran Nelly and Bintang Samudera

0.0

Correlation Coefficient

Pelayaran Nelly  Bintang Samudera

Pay attention - limited upside

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

Pair Corralation between Pelayaran Nelly and Bintang Samudera

If you would invest  26,426  in Pelayaran Nelly Dwi on September 16, 2024 and sell it today you would earn a total of  18,774  from holding Pelayaran Nelly Dwi or generate 71.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Pelayaran Nelly Dwi  vs.  Bintang Samudera Mandiri

Pelayaran Nelly Dwi

Risk-Adjusted Performance

0 of 100

Very Weak

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

Bintang Samudera Mandiri

Risk-Adjusted Performance

0 of 100

OK

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

Pair Trading with Pelayaran Nelly and Bintang Samudera

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

The idea behind Pelayaran Nelly Dwi and Bintang Samudera Mandiri 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.

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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.