Correlation Between Exploitasi Energi and Garda Tujuh

Can any of the company-specific risk be diversified away by investing in both Exploitasi Energi and Garda Tujuh 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 Exploitasi Energi and Garda Tujuh into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Exploitasi Energi Indonesia and Garda Tujuh Buana, you can compare the effects of market volatilities on Exploitasi Energi and Garda Tujuh 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 Exploitasi Energi with a short position of Garda Tujuh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Exploitasi Energi and Garda Tujuh.

Diversification Opportunities for Exploitasi Energi and Garda Tujuh

-0.37

Correlation Coefficient

Exploitasi Energi  Garda Tujuh

Very good diversification

The 3 months correlation between Exploitasi and Garda is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Exploitasi Energi Indonesia and Garda Tujuh Buana in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garda Tujuh Buana and Exploitasi Energi 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 Exploitasi Energi Indonesia are associated (or correlated) with Garda Tujuh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garda Tujuh Buana has no effect on the direction of Exploitasi Energi i.e., Exploitasi Energi and Garda Tujuh go up and down completely randomly.

Pair Corralation between Exploitasi Energi and Garda Tujuh

Assuming the 90 days trading horizon Exploitasi Energi Indonesia is expected to generate 5.69 times more return on investment than Garda Tujuh. However, Exploitasi Energi is 5.69 times more volatile than Garda Tujuh Buana. It trades about 0.1 of its potential returns per unit of risk. Garda Tujuh Buana is currently generating about -0.11 per unit of risk. If you would invest  800.00  in Exploitasi Energi Indonesia on September 12, 2024 and sell it today you would earn a total of  300.00  from holding Exploitasi Energi Indonesia or generate 37.5% return on investment over 90 days.

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

Exploitasi Energi Indonesia  vs.  Garda Tujuh Buana

Exploitasi Energi

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Exploitasi Energi Indonesia are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Exploitasi Energi disclosed solid returns over the last few months and may actually be approaching a breakup point.

Garda Tujuh Buana

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Garda Tujuh Buana has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Exploitasi Energi and Garda Tujuh

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

The idea behind Exploitasi Energi Indonesia and Garda Tujuh Buana 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.