Correlation Between INDO RAMA and PARKEN Sport

Can any of the company-specific risk be diversified away by investing in both INDO RAMA and PARKEN Sport 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 INDO RAMA and PARKEN Sport into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between INDO RAMA SYNTHETIC and PARKEN Sport Entertainment, you can compare the effects of market volatilities on INDO RAMA and PARKEN Sport 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 INDO RAMA with a short position of PARKEN Sport. Check out your portfolio center. Please also check ongoing floating volatility patterns of INDO RAMA and PARKEN Sport.

Diversification Opportunities for INDO RAMA and PARKEN Sport

0.0

Correlation Coefficient

INDO RAMA  PARKEN Sport

Pay attention - limited upside

The 3 months correlation between INDO and PARKEN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding INDO RAMA SYNTHETIC and PARKEN Sport Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PARKEN Sport Enterta and INDO RAMA 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 INDO RAMA SYNTHETIC are associated (or correlated) with PARKEN Sport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PARKEN Sport Enterta has no effect on the direction of INDO RAMA i.e., INDO RAMA and PARKEN Sport go up and down completely randomly.

Pair Corralation between INDO RAMA and PARKEN Sport

If you would invest  1,685  in PARKEN Sport Entertainment on October 10, 2024 and sell it today you would earn a total of  90.00  from holding PARKEN Sport Entertainment or generate 5.34% return on investment over 90 days.

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

INDO RAMA SYNTHETIC  vs.  PARKEN Sport Entertainment

INDO RAMA SYNTHETIC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days INDO RAMA SYNTHETIC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound forward indicators, INDO RAMA is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

PARKEN Sport Enterta

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in PARKEN Sport Entertainment are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, PARKEN Sport reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with INDO RAMA and PARKEN Sport

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

The idea behind INDO RAMA SYNTHETIC and PARKEN Sport Entertainment 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.

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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.