Kimia Farma (Indonesia) Volatility
| KAEF Stock | IDR 635.00 5.00 0.78% |
Kimia Farma Persero has Sharpe Ratio of -0.11, which conveys that the firm had a -0.11% return per unit of risk over the last 3 months. Kimia Farma exposes twenty-three different technical indicators, which can help you to evaluate volatility embedded in its price movement. Please verify Kimia Farma's Risk Adjusted Performance of (0.07), standard deviation of 2.09, and Mean Deviation of 1.45 to check out the risk estimate we provide. Key indicators related to Kimia Farma's volatility include:
90 Days Market Risk | Chance Of Distress | 90 Days Economic Sensitivity |
Kimia Farma Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Kimia daily returns, and it is calculated using variance and standard deviation. We also use Kimia's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Kimia Farma volatility.
Kimia |
Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Kimia Farma at lower prices. For example, an investor can purchase Kimia stock that has halved in price over a short period. This will lower their average cost per share, thereby improving the overall portfolio performance when market normalizes.
Moving together with Kimia Stock
| 0.87 | GGRM | Gudang Garam Tbk | PairCorr |
| 0.9 | TKIM | Pabrik Kertas Tjiwi | PairCorr |
| 0.94 | INKP | Indah Kiat Pulp | PairCorr |
| 0.85 | BMRI | Bank Mandiri Persero | PairCorr |
Moving against Kimia Stock
| 0.77 | MLBI | Multi Bintang Indonesia | PairCorr |
| 0.73 | BYAN | Bayan Resources Tbk | PairCorr |
| 0.4 | UNTR | United Tractors Tbk | PairCorr |
Kimia Farma Market Sensitivity And Downside Risk
Kimia Farma's beta coefficient measures the volatility of Kimia stock compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Kimia stock's returns against your selected market. In other words, Kimia Farma's beta of 0.11 provides an investor with an approximation of how much risk Kimia Farma stock can potentially add to one of your existing portfolios. Kimia Farma Persero exhibits very low volatility with skewness of 0.7 and kurtosis of 2.35. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Kimia Farma's stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Kimia Farma's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Kimia Farma Persero Demand TrendCheck current 90 days Kimia Farma correlation with market (Dow Jones Industrial)Kimia Beta |
Kimia standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 2.12 |
It is essential to understand the difference between upside risk (as represented by Kimia Farma's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Kimia Farma's daily returns or price. Since the actual investment returns on holding a position in kimia stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Kimia Farma.
Kimia Farma Persero Stock Volatility Analysis
Volatility refers to the frequency at which Kimia Farma stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Kimia Farma's price changes. Investors will then calculate the volatility of Kimia Farma's stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Kimia Farma's volatility:
Historical Volatility
This type of stock volatility measures Kimia Farma's fluctuations based on previous trends. It's commonly used to predict Kimia Farma's future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Kimia Farma's current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Kimia Farma's to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Kimia Farma Persero Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Kimia Farma Projected Return Density Against Market
Assuming the 90 days trading horizon Kimia Farma has a beta of 0.107 . This indicates as returns on the market go up, Kimia Farma average returns are expected to increase less than the benchmark. However, during the bear market, the loss on holding Kimia Farma Persero will be expected to be much smaller as well.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Kimia Farma or Pharmaceuticals sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Kimia Farma's price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Kimia stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Kimia Farma Persero has a negative alpha, implying that the risk taken by holding this instrument is not justified. The company is significantly underperforming the Dow Jones Industrial. Predicted Return Density |
| Returns |
What Drives a Kimia Farma Price Volatility?
Several factors can influence a stock's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Kimia Farma Stock Risk Measures
Assuming the 90 days trading horizon the coefficient of variation of Kimia Farma is -877.59. The daily returns are distributed with a variance of 4.5 and standard deviation of 2.12. The mean deviation of Kimia Farma Persero is currently at 1.47. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.73
α | Alpha over Dow Jones | -0.23 | |
β | Beta against Dow Jones | 0.11 | |
σ | Overall volatility | 2.12 | |
Ir | Information ratio | -0.15 |
Kimia Farma Stock Return Volatility
Kimia Farma historical daily return volatility represents how much of Kimia Farma stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The company accepts 2.1224% volatility on return distribution over the 90 days horizon. By contrast, Dow Jones Industrial accepts 0.7299% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About Kimia Farma Volatility
Volatility is a rate at which the price of Kimia Farma or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Kimia Farma may increase or decrease. In other words, similar to Kimia's beta indicator, it measures the risk of Kimia Farma and helps estimate the fluctuations that may happen in a short period of time. So if prices of Kimia Farma fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.PT Kimia Farma Tbk produces and sells medicines, herbal medicines, iodine, salts, quinine and their derivative products, and vegetable oils in Indonesia, rest of Asia, Europe, Australia, Africa, and New Zealand. The company was founded in 1817 and is headquartered in Jakarta, Indonesia. Kimia Farma operates under Drug ManufacturersSpecialty Generic classification in Indonesia and is traded on Jakarta Stock Exchange. It employs 11772 people.
Kimia Farma's stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Kimia Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Kimia Farma's price varies over time.
3 ways to utilize Kimia Farma's volatility to invest better
Higher Kimia Farma's stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Kimia Farma Persero stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Kimia Farma Persero stock volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Kimia Farma Persero investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Kimia Farma's stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Kimia Farma's stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Kimia Farma Investment Opportunity
Kimia Farma Persero has a volatility of 2.12 and is 2.9 times more volatile than Dow Jones Industrial. 18 percent of all equities and portfolios are less risky than Kimia Farma. You can use Kimia Farma Persero to protect your portfolios against small market fluctuations. The stock experiences a moderate downward daily trend and can be a good diversifier. Check odds of Kimia Farma to be traded at 622.3 in 90 days.Significant diversification
The correlation between Kimia Farma Persero and DJI is 0.04 (i.e., Significant diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Kimia Farma Persero and DJI in the same portfolio, assuming nothing else is changed.
Kimia Farma Additional Risk Indicators
The analysis of Kimia Farma's secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Kimia Farma's investment and either accepting that risk or mitigating it. Along with some common measures of Kimia Farma stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | (0.07) | |||
| Market Risk Adjusted Performance | (2.05) | |||
| Mean Deviation | 1.45 | |||
| Coefficient Of Variation | (995.76) | |||
| Standard Deviation | 2.09 | |||
| Variance | 4.38 | |||
| Information Ratio | (0.15) |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Kimia Farma Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Kimia Farma as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Kimia Farma's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Kimia Farma's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Kimia Farma Persero.
Other Information on Investing in Kimia Stock
Kimia Farma financial ratios help investors to determine whether Kimia Stock is cheap or expensive when compared to a particular measure, such as profits or enterprise value. In other words, they help investors to determine the cost of investment in Kimia with respect to the benefits of owning Kimia Farma security.