Correlation Between Pan Brothers and Sona Topas

Can any of the company-specific risk be diversified away by investing in both Pan Brothers and Sona Topas 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 Pan Brothers and Sona Topas into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Pan Brothers Tbk and Sona Topas Tourism, you can compare the effects of market volatilities on Pan Brothers and Sona Topas 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 Pan Brothers with a short position of Sona Topas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pan Brothers and Sona Topas.

Diversification Opportunities for Pan Brothers and Sona Topas

0.0

Correlation Coefficient

Pan Brothers  Sona Topas

Pay attention - limited upside

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

Pair Corralation between Pan Brothers and Sona Topas

If you would invest (100.00) in Sona Topas Tourism on December 29, 2024 and sell it today you would earn a total of  100.00  from holding Sona Topas Tourism or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Pan Brothers Tbk  vs.  Sona Topas Tourism

Pan Brothers Tbk

Risk-Adjusted Performance

Very Weak

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

Sona Topas Tourism

Risk-Adjusted Performance

Very Weak

Over the last 90 days Sona Topas Tourism has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Sona Topas 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 Pan Brothers and Sona Topas

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

The idea behind Pan Brothers Tbk and Sona Topas Tourism 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.