Correlation Between Link Net and Surya Fajar

Can any of the company-specific risk be diversified away by investing in both Link Net and Surya Fajar 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 Link Net and Surya Fajar into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Link Net Tbk and Surya Fajar Capital, you can compare the effects of market volatilities on Link Net and Surya Fajar 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 Link Net with a short position of Surya Fajar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Link Net and Surya Fajar.

Diversification Opportunities for Link Net and Surya Fajar

0.0

Correlation Coefficient

Link Net  Surya Fajar

Pay attention - limited upside

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

Pair Corralation between Link Net and Surya Fajar

If you would invest  120,000  in Link Net Tbk on December 29, 2024 and sell it today you would earn a total of  58,500  from holding Link Net Tbk or generate 48.75% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.67%
Values	Daily Returns

Link Net Tbk  vs.  Surya Fajar Capital

Link Net Tbk

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Link Net Tbk are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Link Net disclosed solid returns over the last few months and may actually be approaching a breakup point.

Surya Fajar Capital

Risk-Adjusted Performance

Very Weak

Over the last 90 days Surya Fajar Capital has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Surya Fajar is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Link Net and Surya Fajar

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

The idea behind Link Net Tbk and Surya Fajar Capital 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.