Correlation Between Eagle High and Perusahaan Perkebunan
Can any of the company-specific risk be diversified away by investing in both Eagle High and Perusahaan Perkebunan 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 Eagle High and Perusahaan Perkebunan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eagle High Plantations and Perusahaan Perkebunan London, you can compare the effects of market volatilities on Eagle High and Perusahaan Perkebunan 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 Eagle High with a short position of Perusahaan Perkebunan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle High and Perusahaan Perkebunan.
Diversification Opportunities for Eagle High and Perusahaan Perkebunan
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Eagle and Perusahaan is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Eagle High Plantations and Perusahaan Perkebunan London in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perusahaan Perkebunan and Eagle High 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 Eagle High Plantations are associated (or correlated) with Perusahaan Perkebunan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perusahaan Perkebunan has no effect on the direction of Eagle High i.e., Eagle High and Perusahaan Perkebunan go up and down completely randomly.
Pair Corralation between Eagle High and Perusahaan Perkebunan
Assuming the 90 days trading horizon Eagle High Plantations is expected to generate 0.88 times more return on investment than Perusahaan Perkebunan. However, Eagle High Plantations is 1.14 times less risky than Perusahaan Perkebunan. It trades about -0.06 of its potential returns per unit of risk. Perusahaan Perkebunan London is currently generating about -0.1 per unit of risk. If you would invest 5,900 in Eagle High Plantations on November 29, 2024 and sell it today you would lose (400.00) from holding Eagle High Plantations or give up 6.78% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Eagle High Plantations vs. Perusahaan Perkebunan London
Performance |
Timeline |
Eagle High Plantations |
Perusahaan Perkebunan |
Eagle High and Perusahaan Perkebunan Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Eagle High and Perusahaan Perkebunan
The main advantage of trading using opposite Eagle High and Perusahaan Perkebunan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle High position performs unexpectedly, Perusahaan Perkebunan 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 Perusahaan Perkebunan will offset losses from the drop in Perusahaan Perkebunan's long position.Eagle High vs. Perusahaan Perkebunan London | Eagle High vs. Salim Ivomas Pratama | Eagle High vs. Alam Sutera Realty | Eagle High vs. Delta Dunia Makmur |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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