Correlation Between Pelayaran Nelly and Satria Antaran

Can any of the company-specific risk be diversified away by investing in both Pelayaran Nelly and Satria Antaran 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 Satria Antaran 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 Satria Antaran Prima, you can compare the effects of market volatilities on Pelayaran Nelly and Satria Antaran 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 Satria Antaran. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pelayaran Nelly and Satria Antaran.

Diversification Opportunities for Pelayaran Nelly and Satria Antaran

0.75

Correlation Coefficient

Pelayaran Nelly  Satria Antaran

Poor diversification

The 3 months correlation between Pelayaran and Satria is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Pelayaran Nelly Dwi and Satria Antaran Prima in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Satria Antaran Prima 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 Satria Antaran. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Satria Antaran Prima has no effect on the direction of Pelayaran Nelly i.e., Pelayaran Nelly and Satria Antaran go up and down completely randomly.

Pair Corralation between Pelayaran Nelly and Satria Antaran

Assuming the 90 days trading horizon Pelayaran Nelly Dwi is expected to under-perform the Satria Antaran. But the stock apears to be less risky and, when comparing its historical volatility, Pelayaran Nelly Dwi is 7.24 times less risky than Satria Antaran. The stock trades about -0.02 of its potential returns per unit of risk. The Satria Antaran Prima is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  179,000  in Satria Antaran Prima on September 29, 2024 and sell it today you would lose (37,500) from holding Satria Antaran Prima or give up 20.95% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Pelayaran Nelly Dwi  vs.  Satria Antaran Prima

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.

Satria Antaran Prima

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Satria Antaran Prima 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.

Pair Trading with Pelayaran Nelly and Satria Antaran

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

The idea behind Pelayaran Nelly Dwi and Satria Antaran Prima 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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.