Correlation Between DICKER DATA and PT Hexindo

Can any of the company-specific risk be diversified away by investing in both DICKER DATA and PT Hexindo 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 DICKER DATA and PT Hexindo into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between DICKER DATA LTD and PT Hexindo Adiperkasa, you can compare the effects of market volatilities on DICKER DATA and PT Hexindo 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 DICKER DATA with a short position of PT Hexindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of DICKER DATA and PT Hexindo.

Diversification Opportunities for DICKER DATA and PT Hexindo

0.6

Correlation Coefficient

DICKER DATA  PT Hexindo

Poor diversification

The 3 months correlation between DICKER and HX1A is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding DICKER DATA LTD and PT Hexindo Adiperkasa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Hexindo Adiperkasa and DICKER DATA 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 DICKER DATA LTD are associated (or correlated) with PT Hexindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Hexindo Adiperkasa has no effect on the direction of DICKER DATA i.e., DICKER DATA and PT Hexindo go up and down completely randomly.

Pair Corralation between DICKER DATA and PT Hexindo

Assuming the 90 days horizon DICKER DATA LTD is expected to under-perform the PT Hexindo. But the stock apears to be less risky and, when comparing its historical volatility, DICKER DATA LTD is 1.57 times less risky than PT Hexindo. The stock trades about -0.03 of its potential returns per unit of risk. The PT Hexindo Adiperkasa is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  31.00  in PT Hexindo Adiperkasa on September 23, 2024 and sell it today you would lose (4.00) from holding PT Hexindo Adiperkasa or give up 12.9% of portfolio value over 90 days.

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

DICKER DATA LTD  vs.  PT Hexindo Adiperkasa

DICKER DATA LTD

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days DICKER DATA LTD has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

PT Hexindo Adiperkasa

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PT Hexindo Adiperkasa has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with DICKER DATA and PT Hexindo

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

The idea behind DICKER DATA LTD and PT Hexindo Adiperkasa 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.