Correlation Between Harum Energy and Salim Ivomas
Can any of the company-specific risk be diversified away by investing in both Harum Energy and Salim Ivomas 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 Harum Energy and Salim Ivomas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Harum Energy Tbk and Salim Ivomas Pratama, you can compare the effects of market volatilities on Harum Energy and Salim Ivomas 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 Harum Energy with a short position of Salim Ivomas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Harum Energy and Salim Ivomas.
Diversification Opportunities for Harum Energy and Salim Ivomas
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Harum and Salim is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Harum Energy Tbk and Salim Ivomas Pratama in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salim Ivomas Pratama and Harum Energy 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 Harum Energy Tbk are associated (or correlated) with Salim Ivomas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salim Ivomas Pratama has no effect on the direction of Harum Energy i.e., Harum Energy and Salim Ivomas go up and down completely randomly.
Pair Corralation between Harum Energy and Salim Ivomas
Assuming the 90 days trading horizon Harum Energy Tbk is expected to under-perform the Salim Ivomas. In addition to that, Harum Energy is 1.34 times more volatile than Salim Ivomas Pratama. It trades about -0.25 of its total potential returns per unit of risk. Salim Ivomas Pratama is currently generating about 0.03 per unit of volatility. If you would invest 37,800 in Salim Ivomas Pratama on December 30, 2024 and sell it today you would earn a total of 800.00 from holding Salim Ivomas Pratama or generate 2.12% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Harum Energy Tbk vs. Salim Ivomas Pratama
Performance |
Timeline |
Harum Energy Tbk |
Salim Ivomas Pratama |
Harum Energy and Salim Ivomas Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Harum Energy and Salim Ivomas
The main advantage of trading using opposite Harum Energy and Salim Ivomas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Harum Energy position performs unexpectedly, Salim Ivomas 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 Salim Ivomas will offset losses from the drop in Salim Ivomas' long position.Harum Energy vs. Indo Tambangraya Megah | Harum Energy vs. Indika Energy Tbk | Harum Energy vs. Adaro Energy Tbk | Harum Energy vs. Akr Corporindo Tbk |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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