Correlation Between Nusa Raya and Pelayaran Nelly

Can any of the company-specific risk be diversified away by investing in both Nusa Raya and Pelayaran Nelly 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 Nusa Raya and Pelayaran Nelly into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Nusa Raya Cipta and Pelayaran Nelly Dwi, you can compare the effects of market volatilities on Nusa Raya and Pelayaran Nelly 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 Nusa Raya with a short position of Pelayaran Nelly. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nusa Raya and Pelayaran Nelly.

Diversification Opportunities for Nusa Raya and Pelayaran Nelly

0.57

Correlation Coefficient

Nusa Raya  Pelayaran Nelly

Very weak diversification

The 3 months correlation between Nusa and Pelayaran is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Nusa Raya Cipta and Pelayaran Nelly Dwi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pelayaran Nelly Dwi and Nusa Raya 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 Nusa Raya Cipta are associated (or correlated) with Pelayaran Nelly. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pelayaran Nelly Dwi has no effect on the direction of Nusa Raya i.e., Nusa Raya and Pelayaran Nelly go up and down completely randomly.

Pair Corralation between Nusa Raya and Pelayaran Nelly

Assuming the 90 days trading horizon Nusa Raya is expected to generate 16.03 times less return on investment than Pelayaran Nelly. But when comparing it to its historical volatility, Nusa Raya Cipta is 1.55 times less risky than Pelayaran Nelly. It trades about 0.0 of its potential returns per unit of risk. Pelayaran Nelly Dwi is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  43,800  in Pelayaran Nelly Dwi on October 27, 2024 and sell it today you would earn a total of  400.00  from holding Pelayaran Nelly Dwi or generate 0.91% return on investment over 90 days.

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

Nusa Raya Cipta  vs.  Pelayaran Nelly Dwi

Nusa Raya Cipta

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nusa Raya Cipta has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pelayaran Nelly Dwi

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pelayaran Nelly Dwi has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Pelayaran Nelly 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 Nusa Raya and Pelayaran Nelly

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

The idea behind Nusa Raya Cipta and Pelayaran Nelly Dwi 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..