Correlation Between PT Jasa and Huntington Bancshares

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Can any of the company-specific risk be diversified away by investing in both PT Jasa and Huntington Bancshares 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 PT Jasa and Huntington Bancshares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Jasa Marga and Huntington Bancshares Incorporated, you can compare the effects of market volatilities on PT Jasa and Huntington Bancshares 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 PT Jasa with a short position of Huntington Bancshares. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Jasa and Huntington Bancshares.

Diversification Opportunities for PT Jasa and Huntington Bancshares

0JMHuntingtonDiversified Away0JMHuntingtonDiversified Away100%
-0.58
  Correlation Coefficient

Excellent diversification

The 3 months correlation between 0JM and Huntington is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding PT Jasa Marga and Huntington Bancshares Incorpor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huntington Bancshares and PT Jasa 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 PT Jasa Marga are associated (or correlated) with Huntington Bancshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huntington Bancshares has no effect on the direction of PT Jasa i.e., PT Jasa and Huntington Bancshares go up and down completely randomly.

Pair Corralation between PT Jasa and Huntington Bancshares

Assuming the 90 days horizon PT Jasa Marga is expected to generate 3.22 times more return on investment than Huntington Bancshares. However, PT Jasa is 3.22 times more volatile than Huntington Bancshares Incorporated. It trades about 0.02 of its potential returns per unit of risk. Huntington Bancshares Incorporated is currently generating about -0.16 per unit of risk. If you would invest  25.00  in PT Jasa Marga on October 8, 2024 and sell it today you would earn a total of  0.00  from holding PT Jasa Marga or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

PT Jasa Marga  vs.  Huntington Bancshares Incorpor

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -100102030
JavaScript chart by amCharts 3.21.150JM HU3
       Timeline  
PT Jasa Marga 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days PT Jasa Marga has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, PT Jasa is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan0.220.230.240.250.260.270.280.290.3
Huntington Bancshares 

Risk-Adjusted Performance

13 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Huntington Bancshares Incorporated are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Huntington Bancshares reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan13.51414.51515.51616.517

PT Jasa and Huntington Bancshares Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-5.64-4.22-2.81-1.390.01.392.784.175.57 0.020.040.060.080.10
JavaScript chart by amCharts 3.21.150JM HU3
       Returns  

Pair Trading with PT Jasa and Huntington Bancshares

The main advantage of trading using opposite PT Jasa and Huntington Bancshares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Jasa position performs unexpectedly, Huntington Bancshares 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 Huntington Bancshares will offset losses from the drop in Huntington Bancshares' long position.
The idea behind PT Jasa Marga and Huntington Bancshares Incorporated 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

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