Correlation Between Ristia Bintang and Surya Semesta

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

By analyzing existing cross correlation between Ristia Bintang Mahkotasejati and Surya Semesta Internusa, you can compare the effects of market volatilities on Ristia Bintang and Surya Semesta 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 Ristia Bintang with a short position of Surya Semesta. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ristia Bintang and Surya Semesta.

Diversification Opportunities for Ristia Bintang and Surya Semesta

-0.7

Correlation Coefficient

Ristia Bintang  Surya Semesta

Excellent diversification

The 3 months correlation between Ristia and Surya is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Ristia Bintang Mahkotasejati and Surya Semesta Internusa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Surya Semesta Internusa and Ristia Bintang 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 Ristia Bintang Mahkotasejati are associated (or correlated) with Surya Semesta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Surya Semesta Internusa has no effect on the direction of Ristia Bintang i.e., Ristia Bintang and Surya Semesta go up and down completely randomly.

Pair Corralation between Ristia Bintang and Surya Semesta

Assuming the 90 days trading horizon Ristia Bintang Mahkotasejati is expected to under-perform the Surya Semesta. But the stock apears to be less risky and, when comparing its historical volatility, Ristia Bintang Mahkotasejati is 1.78 times less risky than Surya Semesta. The stock trades about -0.1 of its potential returns per unit of risk. The Surya Semesta Internusa is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  104,000  in Surya Semesta Internusa on October 10, 2024 and sell it today you would earn a total of  6,500  from holding Surya Semesta Internusa or generate 6.25% return on investment over 90 days.

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

Ristia Bintang Mahkotasejati  vs.  Surya Semesta Internusa

Ristia Bintang Mahko

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Ristia Bintang Mahkotasejati are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Ristia Bintang is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Surya Semesta Internusa

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Surya Semesta Internusa has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Surya Semesta 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 Ristia Bintang and Surya Semesta

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

The idea behind Ristia Bintang Mahkotasejati and Surya Semesta Internusa 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.