Correlation Between Surya Semesta and Nusa Raya

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

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

Diversification Opportunities for Surya Semesta and Nusa Raya

0.69

Correlation Coefficient

Surya Semesta  Nusa Raya

Poor diversification

The 3 months correlation between Surya and Nusa is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Surya Semesta Internusa and Nusa Raya Cipta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nusa Raya Cipta and Surya Semesta 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 Surya Semesta Internusa are associated (or correlated) with Nusa Raya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nusa Raya Cipta has no effect on the direction of Surya Semesta i.e., Surya Semesta and Nusa Raya go up and down completely randomly.

Pair Corralation between Surya Semesta and Nusa Raya

Assuming the 90 days trading horizon Surya Semesta Internusa is expected to under-perform the Nusa Raya. In addition to that, Surya Semesta is 3.49 times more volatile than Nusa Raya Cipta. It trades about -0.07 of its total potential returns per unit of risk. Nusa Raya Cipta is currently generating about -0.09 per unit of volatility. If you would invest  34,600  in Nusa Raya Cipta on December 20, 2024 and sell it today you would lose (2,200) from holding Nusa Raya Cipta or give up 6.36% of portfolio value over 90 days.

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

Surya Semesta Internusa  vs.  Nusa Raya Cipta

Surya Semesta Internusa

Risk-Adjusted Performance

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 conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Nusa Raya Cipta

Risk-Adjusted Performance

Very Weak

Over the last 90 days Nusa Raya Cipta has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's forward-looking signals remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Surya Semesta and Nusa Raya

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

The idea behind Surya Semesta Internusa and Nusa Raya Cipta 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.