Correlation Between Nusantara Almazia and Puri Global

Can any of the company-specific risk be diversified away by investing in both Nusantara Almazia and Puri Global 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 Nusantara Almazia and Puri Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Nusantara Almazia and Puri Global Sukses, you can compare the effects of market volatilities on Nusantara Almazia and Puri Global 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 Nusantara Almazia with a short position of Puri Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nusantara Almazia and Puri Global.

Diversification Opportunities for Nusantara Almazia and Puri Global

-0.39

Correlation Coefficient

Nusantara Almazia  Puri Global

Very good diversification

The 3 months correlation between Nusantara and Puri is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Nusantara Almazia and Puri Global Sukses in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Puri Global Sukses and Nusantara Almazia 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 Nusantara Almazia are associated (or correlated) with Puri Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Puri Global Sukses has no effect on the direction of Nusantara Almazia i.e., Nusantara Almazia and Puri Global go up and down completely randomly.

Pair Corralation between Nusantara Almazia and Puri Global

Assuming the 90 days trading horizon Nusantara Almazia is expected to under-perform the Puri Global. In addition to that, Nusantara Almazia is 1.05 times more volatile than Puri Global Sukses. It trades about -0.04 of its total potential returns per unit of risk. Puri Global Sukses is currently generating about 0.16 per unit of volatility. If you would invest  21,600  in Puri Global Sukses on October 26, 2024 and sell it today you would earn a total of  9,800  from holding Puri Global Sukses or generate 45.37% return on investment over 90 days.

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

Nusantara Almazia  vs.  Puri Global Sukses

Nusantara Almazia

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nusantara Almazia has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Puri Global Sukses

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Puri Global Sukses are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Puri Global disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Nusantara Almazia and Puri Global

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

The idea behind Nusantara Almazia and Puri Global Sukses 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.