Correlation Between Yuexiu Transport and Indo Tambangraya

Can any of the company-specific risk be diversified away by investing in both Yuexiu Transport and Indo Tambangraya 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 Yuexiu Transport and Indo Tambangraya into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Yuexiu Transport Infrastructure and Indo Tambangraya Megah, you can compare the effects of market volatilities on Yuexiu Transport and Indo Tambangraya 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 Yuexiu Transport with a short position of Indo Tambangraya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuexiu Transport and Indo Tambangraya.

Diversification Opportunities for Yuexiu Transport and Indo Tambangraya

0.0

Correlation Coefficient

Yuexiu Transport  Indo Tambangraya

Pay attention - limited upside

The 3 months correlation between Yuexiu and Indo is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Yuexiu Transport Infrastructur and Indo Tambangraya Megah in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indo Tambangraya Megah and Yuexiu Transport 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 Yuexiu Transport Infrastructure are associated (or correlated) with Indo Tambangraya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indo Tambangraya Megah has no effect on the direction of Yuexiu Transport i.e., Yuexiu Transport and Indo Tambangraya go up and down completely randomly.

Pair Corralation between Yuexiu Transport and Indo Tambangraya

If you would invest  58.00  in Yuexiu Transport Infrastructure on December 29, 2024 and sell it today you would earn a total of  0.00  from holding Yuexiu Transport Infrastructure or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.31%
Values	Daily Returns

Yuexiu Transport Infrastructur  vs.  Indo Tambangraya Megah

Yuexiu Transport Inf

Risk-Adjusted Performance

Very Weak

Over the last 90 days Yuexiu Transport Infrastructure has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Yuexiu Transport is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Indo Tambangraya Megah

Risk-Adjusted Performance

Very Weak

Over the last 90 days Indo Tambangraya Megah has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Yuexiu Transport and Indo Tambangraya

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

The idea behind Yuexiu Transport Infrastructure and Indo Tambangraya Megah 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.