Correlation Between PT Data and Semacom Integrated

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

By analyzing existing cross correlation between PT Data Sinergitama and Semacom Integrated Tbk, you can compare the effects of market volatilities on PT Data and Semacom Integrated 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 PT Data with a short position of Semacom Integrated. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Data and Semacom Integrated.

Diversification Opportunities for PT Data and Semacom Integrated

-0.03

Correlation Coefficient

PT Data  Semacom Integrated

Good diversification

The 3 months correlation between ELIT and Semacom is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding PT Data Sinergitama and Semacom Integrated Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Semacom Integrated Tbk and PT 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 PT Data Sinergitama are associated (or correlated) with Semacom Integrated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Semacom Integrated Tbk has no effect on the direction of PT Data i.e., PT Data and Semacom Integrated go up and down completely randomly.

Pair Corralation between PT Data and Semacom Integrated

Assuming the 90 days trading horizon PT Data Sinergitama is expected to generate 0.27 times more return on investment than Semacom Integrated. However, PT Data Sinergitama is 3.65 times less risky than Semacom Integrated. It trades about 0.26 of its potential returns per unit of risk. Semacom Integrated Tbk is currently generating about 0.07 per unit of risk. If you would invest  11,500  in PT Data Sinergitama on October 25, 2024 and sell it today you would earn a total of  1,400  from holding PT Data Sinergitama or generate 12.17% return on investment over 90 days.

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

PT Data Sinergitama  vs.  Semacom Integrated Tbk

PT Data Sinergitama

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days PT Data Sinergitama has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Semacom Integrated Tbk

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Semacom Integrated Tbk are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Semacom Integrated is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with PT Data and Semacom Integrated

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

The idea behind PT Data Sinergitama and Semacom Integrated Tbk 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 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.