Correlation Between Rimo International and Suryamas Dutamakmur

Can any of the company-specific risk be diversified away by investing in both Rimo International and Suryamas Dutamakmur 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 Rimo International and Suryamas Dutamakmur into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Rimo International Lestari and Suryamas Dutamakmur Tbk, you can compare the effects of market volatilities on Rimo International and Suryamas Dutamakmur 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 Rimo International with a short position of Suryamas Dutamakmur. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rimo International and Suryamas Dutamakmur.

Diversification Opportunities for Rimo International and Suryamas Dutamakmur

0.0

Correlation Coefficient

Rimo International  Suryamas Dutamakmur

Pay attention - limited upside

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

Pair Corralation between Rimo International and Suryamas Dutamakmur

If you would invest  52,000  in Suryamas Dutamakmur Tbk on December 22, 2024 and sell it today you would earn a total of  99,000  from holding Suryamas Dutamakmur Tbk or generate 190.38% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	98.31%
Values	Daily Returns

Rimo International Lestari  vs.  Suryamas Dutamakmur Tbk

Rimo International

Risk-Adjusted Performance

Very Weak

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

Suryamas Dutamakmur Tbk

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Suryamas Dutamakmur Tbk are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Suryamas Dutamakmur disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Rimo International and Suryamas Dutamakmur

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

The idea behind Rimo International Lestari and Suryamas Dutamakmur Tbk 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.