Correlation Between Berlina Tbk and Anugerah Kagum

Can any of the company-specific risk be diversified away by investing in both Berlina Tbk and Anugerah Kagum 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 Berlina Tbk and Anugerah Kagum into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Berlina Tbk and Anugerah Kagum Karya, you can compare the effects of market volatilities on Berlina Tbk and Anugerah Kagum 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 Berlina Tbk with a short position of Anugerah Kagum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Berlina Tbk and Anugerah Kagum.

Diversification Opportunities for Berlina Tbk and Anugerah Kagum

-0.29

Correlation Coefficient

Berlina Tbk  Anugerah Kagum

Very good diversification

The 3 months correlation between Berlina and Anugerah is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Berlina Tbk and Anugerah Kagum Karya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anugerah Kagum Karya and Berlina Tbk 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 Berlina Tbk are associated (or correlated) with Anugerah Kagum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anugerah Kagum Karya has no effect on the direction of Berlina Tbk i.e., Berlina Tbk and Anugerah Kagum go up and down completely randomly.

Pair Corralation between Berlina Tbk and Anugerah Kagum

Assuming the 90 days trading horizon Berlina Tbk is expected to generate 4.72 times less return on investment than Anugerah Kagum. But when comparing it to its historical volatility, Berlina Tbk is 1.04 times less risky than Anugerah Kagum. It trades about 0.0 of its potential returns per unit of risk. Anugerah Kagum Karya is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  1,400  in Anugerah Kagum Karya on September 12, 2024 and sell it today you would earn a total of  0.00  from holding Anugerah Kagum Karya or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.41%
Values	Daily Returns

Berlina Tbk  vs.  Anugerah Kagum Karya

Berlina Tbk

Risk-Adjusted Performance

0 of 100

Very Weak

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

Anugerah Kagum Karya

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Anugerah Kagum Karya are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Anugerah Kagum 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 Berlina Tbk and Anugerah Kagum

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

The idea behind Berlina Tbk and Anugerah Kagum Karya 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.