Correlation Between Diamond Citra and Perintis Triniti

Can any of the company-specific risk be diversified away by investing in both Diamond Citra and Perintis Triniti 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 Diamond Citra and Perintis Triniti into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Diamond Citra Propertindo and Perintis Triniti Properti, you can compare the effects of market volatilities on Diamond Citra and Perintis Triniti 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 Diamond Citra with a short position of Perintis Triniti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Diamond Citra and Perintis Triniti.

Diversification Opportunities for Diamond Citra and Perintis Triniti

0.46

Correlation Coefficient

Diamond Citra  Perintis Triniti

Very weak diversification

The 3 months correlation between Diamond and Perintis is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Diamond Citra Propertindo and Perintis Triniti Properti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perintis Triniti Properti and Diamond Citra 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 Diamond Citra Propertindo are associated (or correlated) with Perintis Triniti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perintis Triniti Properti has no effect on the direction of Diamond Citra i.e., Diamond Citra and Perintis Triniti go up and down completely randomly.

Pair Corralation between Diamond Citra and Perintis Triniti

Assuming the 90 days trading horizon Diamond Citra Propertindo is expected to generate 2.09 times more return on investment than Perintis Triniti. However, Diamond Citra is 2.09 times more volatile than Perintis Triniti Properti. It trades about 0.01 of its potential returns per unit of risk. Perintis Triniti Properti is currently generating about -0.17 per unit of risk. If you would invest  800.00  in Diamond Citra Propertindo on December 24, 2024 and sell it today you would lose (100.00) from holding Diamond Citra Propertindo or give up 12.5% of portfolio value over 90 days.

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

Diamond Citra Propertindo  vs.  Perintis Triniti Properti

Diamond Citra Propertindo

Risk-Adjusted Performance

Very Weak

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

Perintis Triniti Properti

Risk-Adjusted Performance

Very Weak

Over the last 90 days Perintis Triniti Properti 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 Diamond Citra and Perintis Triniti

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

The idea behind Diamond Citra Propertindo and Perintis Triniti Properti 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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.