Correlation Between Dharma Polimetal and Garuda Metalindo
Can any of the company-specific risk be diversified away by investing in both Dharma Polimetal and Garuda Metalindo 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 Dharma Polimetal and Garuda Metalindo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dharma Polimetal Tbk and Garuda Metalindo Tbk, you can compare the effects of market volatilities on Dharma Polimetal and Garuda Metalindo 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 Dharma Polimetal with a short position of Garuda Metalindo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dharma Polimetal and Garuda Metalindo.
Diversification Opportunities for Dharma Polimetal and Garuda Metalindo
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dharma and Garuda is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Dharma Polimetal Tbk and Garuda Metalindo Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Garuda Metalindo Tbk and Dharma Polimetal 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 Dharma Polimetal Tbk are associated (or correlated) with Garuda Metalindo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Garuda Metalindo Tbk has no effect on the direction of Dharma Polimetal i.e., Dharma Polimetal and Garuda Metalindo go up and down completely randomly.
Pair Corralation between Dharma Polimetal and Garuda Metalindo
Assuming the 90 days trading horizon Dharma Polimetal Tbk is expected to under-perform the Garuda Metalindo. But the stock apears to be less risky and, when comparing its historical volatility, Dharma Polimetal Tbk is 1.1 times less risky than Garuda Metalindo. The stock trades about -0.16 of its potential returns per unit of risk. The Garuda Metalindo Tbk is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 124,500 in Garuda Metalindo Tbk on December 2, 2024 and sell it today you would earn a total of 8,000 from holding Garuda Metalindo Tbk or generate 6.43% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Dharma Polimetal Tbk vs. Garuda Metalindo Tbk
Performance |
Timeline |
Dharma Polimetal Tbk |
Garuda Metalindo Tbk |
Dharma Polimetal and Garuda Metalindo Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dharma Polimetal and Garuda Metalindo
The main advantage of trading using opposite Dharma Polimetal and Garuda Metalindo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dharma Polimetal position performs unexpectedly, Garuda Metalindo 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 Garuda Metalindo will offset losses from the drop in Garuda Metalindo's long position.Dharma Polimetal vs. Triputra Agro Persada | Dharma Polimetal vs. Autopedia Sukses Lestari | Dharma Polimetal vs. Cisarua Mountain Dairy | Dharma Polimetal vs. Surya Esa Perkasa |
Garuda Metalindo vs. Indo Kordsa Tbk | Garuda Metalindo vs. Indospring Tbk | Garuda Metalindo vs. Kabelindo Murni Tbk | Garuda Metalindo vs. Blue Bird Tbk |
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 Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
Other Complementary Tools
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Stocks Directory Find actively traded stocks across global markets | |
Portfolio Anywhere Track or share privately all of your investments from the convenience of any device |