Correlation Between Panorama Sentrawisata and Integra Indocabinet
Can any of the company-specific risk be diversified away by investing in both Panorama Sentrawisata and Integra Indocabinet 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 Panorama Sentrawisata and Integra Indocabinet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Panorama Sentrawisata Tbk and Integra Indocabinet Tbk, you can compare the effects of market volatilities on Panorama Sentrawisata and Integra Indocabinet 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 Panorama Sentrawisata with a short position of Integra Indocabinet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Panorama Sentrawisata and Integra Indocabinet.
Diversification Opportunities for Panorama Sentrawisata and Integra Indocabinet
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Panorama and Integra is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Panorama Sentrawisata Tbk and Integra Indocabinet Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integra Indocabinet Tbk and Panorama Sentrawisata 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 Panorama Sentrawisata Tbk are associated (or correlated) with Integra Indocabinet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integra Indocabinet Tbk has no effect on the direction of Panorama Sentrawisata i.e., Panorama Sentrawisata and Integra Indocabinet go up and down completely randomly.
Pair Corralation between Panorama Sentrawisata and Integra Indocabinet
Assuming the 90 days trading horizon Panorama Sentrawisata is expected to generate 1.41 times less return on investment than Integra Indocabinet. But when comparing it to its historical volatility, Panorama Sentrawisata Tbk is 3.95 times less risky than Integra Indocabinet. It trades about 0.31 of its potential returns per unit of risk. Integra Indocabinet Tbk is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 23,800 in Integra Indocabinet Tbk on September 26, 2024 and sell it today you would earn a total of 6,800 from holding Integra Indocabinet Tbk or generate 28.57% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 98.44% |
Values | Daily Returns |
Panorama Sentrawisata Tbk vs. Integra Indocabinet Tbk
Performance |
Timeline |
Panorama Sentrawisata Tbk |
Integra Indocabinet Tbk |
Panorama Sentrawisata and Integra Indocabinet Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Panorama Sentrawisata and Integra Indocabinet
The main advantage of trading using opposite Panorama Sentrawisata and Integra Indocabinet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Panorama Sentrawisata position performs unexpectedly, Integra Indocabinet 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 Integra Indocabinet will offset losses from the drop in Integra Indocabinet's long position.Panorama Sentrawisata vs. Pembangunan Jaya Ancol | Panorama Sentrawisata vs. Sona Topas Tourism | Panorama Sentrawisata vs. Millennium Pharmacon International | Panorama Sentrawisata vs. Tempo Inti Media |
Integra Indocabinet vs. Pembangunan Jaya Ancol | Integra Indocabinet vs. Panorama Sentrawisata Tbk | Integra Indocabinet vs. Sona Topas Tourism | Integra Indocabinet vs. Millennium Pharmacon International |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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