Correlation Between Champion Pacific and Waskita Karya

Can any of the company-specific risk be diversified away by investing in both Champion Pacific and Waskita Karya 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 Champion Pacific and Waskita Karya into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Champion Pacific Indonesia and Waskita Karya Persero, you can compare the effects of market volatilities on Champion Pacific and Waskita Karya 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 Champion Pacific with a short position of Waskita Karya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Champion Pacific and Waskita Karya.

Diversification Opportunities for Champion Pacific and Waskita Karya

0.0

Correlation Coefficient

Champion Pacific  Waskita Karya

Pay attention - limited upside

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

Pair Corralation between Champion Pacific and Waskita Karya

If you would invest  54,000  in Champion Pacific Indonesia on December 29, 2024 and sell it today you would earn a total of  500.00  from holding Champion Pacific Indonesia or generate 0.93% return on investment over 90 days.

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

Champion Pacific Indonesia  vs.  Waskita Karya Persero

Champion Pacific Ind

Risk-Adjusted Performance

Weak

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

Waskita Karya Persero

Risk-Adjusted Performance

Very Weak

Over the last 90 days Waskita Karya Persero has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Waskita Karya 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 Champion Pacific and Waskita Karya

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

The idea behind Champion Pacific Indonesia and Waskita Karya Persero 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.