Correlation Between Sidomulyo Selaras and Pool Advista

Can any of the company-specific risk be diversified away by investing in both Sidomulyo Selaras and Pool Advista 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 Sidomulyo Selaras and Pool Advista into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Sidomulyo Selaras Tbk and Pool Advista Finance, you can compare the effects of market volatilities on Sidomulyo Selaras and Pool Advista 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 Sidomulyo Selaras with a short position of Pool Advista. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sidomulyo Selaras and Pool Advista.

Diversification Opportunities for Sidomulyo Selaras and Pool Advista

0.18

Correlation Coefficient

Sidomulyo Selaras  Pool Advista

Average diversification

The 3 months correlation between Sidomulyo and Pool is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Sidomulyo Selaras Tbk and Pool Advista Finance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pool Advista Finance and Sidomulyo Selaras 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 Sidomulyo Selaras Tbk are associated (or correlated) with Pool Advista. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pool Advista Finance has no effect on the direction of Sidomulyo Selaras i.e., Sidomulyo Selaras and Pool Advista go up and down completely randomly.

Pair Corralation between Sidomulyo Selaras and Pool Advista

Assuming the 90 days trading horizon Sidomulyo Selaras Tbk is expected to generate 0.7 times more return on investment than Pool Advista. However, Sidomulyo Selaras Tbk is 1.43 times less risky than Pool Advista. It trades about 0.0 of its potential returns per unit of risk. Pool Advista Finance is currently generating about -0.02 per unit of risk. If you would invest  2,700  in Sidomulyo Selaras Tbk on September 12, 2024 and sell it today you would lose (100.00) from holding Sidomulyo Selaras Tbk or give up 3.7% of portfolio value over 90 days.

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

Sidomulyo Selaras Tbk  vs.  Pool Advista Finance

Sidomulyo Selaras Tbk

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pool Advista Finance

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pool Advista Finance has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Sidomulyo Selaras and Pool Advista

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

The idea behind Sidomulyo Selaras Tbk and Pool Advista Finance 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.