Correlation Between Sona Topas and Era Media
Can any of the company-specific risk be diversified away by investing in both Sona Topas and Era Media 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 Sona Topas and Era Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sona Topas Tourism and Era Media Sejahtera, you can compare the effects of market volatilities on Sona Topas and Era Media 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 Sona Topas with a short position of Era Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sona Topas and Era Media.
Diversification Opportunities for Sona Topas and Era Media
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Sona and Era is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Sona Topas Tourism and Era Media Sejahtera in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Era Media Sejahtera and Sona Topas 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 Sona Topas Tourism are associated (or correlated) with Era Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Era Media Sejahtera has no effect on the direction of Sona Topas i.e., Sona Topas and Era Media go up and down completely randomly.
Pair Corralation between Sona Topas and Era Media
Assuming the 90 days trading horizon Sona Topas is expected to generate 3.06 times less return on investment than Era Media. In addition to that, Sona Topas is 1.13 times more volatile than Era Media Sejahtera. It trades about 0.03 of its total potential returns per unit of risk. Era Media Sejahtera is currently generating about 0.11 per unit of volatility. If you would invest 5,800 in Era Media Sejahtera on December 28, 2024 and sell it today you would earn a total of 2,600 from holding Era Media Sejahtera or generate 44.83% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Sona Topas Tourism vs. Era Media Sejahtera
Performance |
Timeline |
Sona Topas Tourism |
Era Media Sejahtera |
Sona Topas and Era Media Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sona Topas and Era Media
The main advantage of trading using opposite Sona Topas and Era Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sona Topas position performs unexpectedly, Era Media 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 Era Media will offset losses from the drop in Era Media's long position.Sona Topas vs. Lippo General Insurance | Sona Topas vs. Garuda Metalindo Tbk | Sona Topas vs. Prima Alloy Steel | Sona Topas vs. HK Metals Utama |
Era Media vs. Grand Kartech Tbk | Era Media vs. Metrodata Electronics Tbk | Era Media vs. Indonesian Tobacco Tbk | Era Media vs. Lippo General Insurance |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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