Correlation Between Citatah Tbk and Pembangunan Graha

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

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

Diversification Opportunities for Citatah Tbk and Pembangunan Graha

-0.12

Correlation Coefficient

Citatah Tbk  Pembangunan Graha

Good diversification

The 3 months correlation between Citatah and Pembangunan is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Citatah Tbk and Pembangunan Graha Lestari in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pembangunan Graha Lestari and Citatah 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 Citatah Tbk are associated (or correlated) with Pembangunan Graha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pembangunan Graha Lestari has no effect on the direction of Citatah Tbk i.e., Citatah Tbk and Pembangunan Graha go up and down completely randomly.

Pair Corralation between Citatah Tbk and Pembangunan Graha

Assuming the 90 days trading horizon Citatah Tbk is expected to generate 0.5 times more return on investment than Pembangunan Graha. However, Citatah Tbk is 2.01 times less risky than Pembangunan Graha. It trades about 0.04 of its potential returns per unit of risk. Pembangunan Graha Lestari is currently generating about -0.13 per unit of risk. If you would invest  2,600  in Citatah Tbk on December 30, 2024 and sell it today you would earn a total of  100.00  from holding Citatah Tbk or generate 3.85% return on investment over 90 days.

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

Citatah Tbk  vs.  Pembangunan Graha Lestari

Citatah Tbk

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Citatah Tbk are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Citatah Tbk is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pembangunan Graha Lestari

Risk-Adjusted Performance

Very Weak

Over the last 90 days Pembangunan Graha Lestari has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Citatah Tbk and Pembangunan Graha

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

The idea behind Citatah Tbk and Pembangunan Graha Lestari 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.