Correlation Between Hotel Sahid and Trisula Textile
Can any of the company-specific risk be diversified away by investing in both Hotel Sahid and Trisula Textile 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 Hotel Sahid and Trisula Textile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hotel Sahid Jaya and Trisula Textile Industries, you can compare the effects of market volatilities on Hotel Sahid and Trisula Textile 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 Hotel Sahid with a short position of Trisula Textile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hotel Sahid and Trisula Textile.
Diversification Opportunities for Hotel Sahid and Trisula Textile
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hotel and Trisula is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Hotel Sahid Jaya and Trisula Textile Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trisula Textile Indu and Hotel Sahid 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 Hotel Sahid Jaya are associated (or correlated) with Trisula Textile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trisula Textile Indu has no effect on the direction of Hotel Sahid i.e., Hotel Sahid and Trisula Textile go up and down completely randomly.
Pair Corralation between Hotel Sahid and Trisula Textile
Assuming the 90 days trading horizon Hotel Sahid Jaya is expected to under-perform the Trisula Textile. In addition to that, Hotel Sahid is 1.32 times more volatile than Trisula Textile Industries. It trades about -0.03 of its total potential returns per unit of risk. Trisula Textile Industries is currently generating about 0.0 per unit of volatility. If you would invest 6,000 in Trisula Textile Industries on December 30, 2024 and sell it today you would lose (500.00) from holding Trisula Textile Industries or give up 8.33% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Hotel Sahid Jaya vs. Trisula Textile Industries
Performance |
Timeline |
Hotel Sahid Jaya |
Trisula Textile Indu |
Hotel Sahid and Trisula Textile Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hotel Sahid and Trisula Textile
The main advantage of trading using opposite Hotel Sahid and Trisula Textile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hotel Sahid position performs unexpectedly, Trisula Textile 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 Trisula Textile will offset losses from the drop in Trisula Textile's long position.Hotel Sahid vs. Pembangunan Jaya Ancol | Hotel Sahid vs. Panorama Sentrawisata Tbk | Hotel Sahid vs. Sona Topas Tourism | Hotel Sahid vs. Millennium Pharmacon International |
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Check out your portfolio center.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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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