Correlation Between Armada Hflr and Pelayaran Kurnia

Can any of the company-specific risk be diversified away by investing in both Armada Hflr and Pelayaran Kurnia 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 Armada Hflr and Pelayaran Kurnia into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Armada Hflr Pr and Pelayaran Kurnia Lautan, you can compare the effects of market volatilities on Armada Hflr and Pelayaran Kurnia 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 Armada Hflr with a short position of Pelayaran Kurnia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and Pelayaran Kurnia.

Diversification Opportunities for Armada Hflr and Pelayaran Kurnia

0.14

Correlation Coefficient

Armada Hflr  Pelayaran Kurnia

Average diversification

The 3 months correlation between Armada and Pelayaran is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Armada Hflr Pr and Pelayaran Kurnia Lautan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pelayaran Kurnia Lautan and Armada Hflr 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 Armada Hflr Pr are associated (or correlated) with Pelayaran Kurnia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pelayaran Kurnia Lautan has no effect on the direction of Armada Hflr i.e., Armada Hflr and Pelayaran Kurnia go up and down completely randomly.

Pair Corralation between Armada Hflr and Pelayaran Kurnia

Considering the 90-day investment horizon Armada Hflr is expected to generate 164.23 times less return on investment than Pelayaran Kurnia. But when comparing it to its historical volatility, Armada Hflr Pr is 32.84 times less risky than Pelayaran Kurnia. It trades about 0.01 of its potential returns per unit of risk. Pelayaran Kurnia Lautan is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  10,975  in Pelayaran Kurnia Lautan on September 26, 2024 and sell it today you would lose (675.00) from holding Pelayaran Kurnia Lautan or give up 6.15% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	75.2%
Values	Daily Returns

Armada Hflr Pr  vs.  Pelayaran Kurnia Lautan

Armada Hflr Pr

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Armada Hflr Pr has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical indicators, Armada Hflr is not utilizing all of its potentials. The recent stock price confusion, may contribute to short-horizon losses for the traders.

Pelayaran Kurnia Lautan

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Armada Hflr and Pelayaran Kurnia

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

The idea behind Armada Hflr Pr and Pelayaran Kurnia Lautan 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 Transaction History module to view history of all your transactions and understand their impact on performance.