Correlation Between Dharma Satya and Kino Indonesia
Can any of the company-specific risk be diversified away by investing in both Dharma Satya and Kino Indonesia 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 Satya and Kino Indonesia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dharma Satya Nusantara and Kino Indonesia Tbk, you can compare the effects of market volatilities on Dharma Satya and Kino Indonesia 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 Satya with a short position of Kino Indonesia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dharma Satya and Kino Indonesia.
Diversification Opportunities for Dharma Satya and Kino Indonesia
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Dharma and Kino is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Dharma Satya Nusantara and Kino Indonesia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kino Indonesia Tbk and Dharma Satya 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 Satya Nusantara are associated (or correlated) with Kino Indonesia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kino Indonesia Tbk has no effect on the direction of Dharma Satya i.e., Dharma Satya and Kino Indonesia go up and down completely randomly.
Pair Corralation between Dharma Satya and Kino Indonesia
Assuming the 90 days trading horizon Dharma Satya Nusantara is expected to under-perform the Kino Indonesia. In addition to that, Dharma Satya is 2.56 times more volatile than Kino Indonesia Tbk. It trades about -0.12 of its total potential returns per unit of risk. Kino Indonesia Tbk is currently generating about -0.04 per unit of volatility. If you would invest 120,000 in Kino Indonesia Tbk on December 5, 2024 and sell it today you would lose (4,000) from holding Kino Indonesia Tbk or give up 3.33% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Dharma Satya Nusantara vs. Kino Indonesia Tbk
Performance |
Timeline |
Dharma Satya Nusantara |
Kino Indonesia Tbk |
Dharma Satya and Kino Indonesia Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dharma Satya and Kino Indonesia
The main advantage of trading using opposite Dharma Satya and Kino Indonesia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dharma Satya position performs unexpectedly, Kino Indonesia 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 Kino Indonesia will offset losses from the drop in Kino Indonesia's long position.Dharma Satya vs. Salim Ivomas Pratama | Dharma Satya vs. Sawit Sumbermas Sarana | Dharma Satya vs. Austindo Nusantara Jaya | Dharma Satya vs. Eagle High Plantations |
Kino Indonesia vs. Nippon Indosari Corpindo | Kino Indonesia vs. Mitra Keluarga Karyasehat | Kino Indonesia vs. Buyung Poetra Sembada | Kino Indonesia vs. Sariguna Primatirta PT |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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