Correlation Between Lancartama Sejati and Perintis Triniti

Can any of the company-specific risk be diversified away by investing in both Lancartama Sejati and Perintis Triniti 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 Lancartama Sejati and Perintis Triniti into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Lancartama Sejati Tbk and Perintis Triniti Properti, you can compare the effects of market volatilities on Lancartama Sejati and Perintis Triniti 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 Lancartama Sejati with a short position of Perintis Triniti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lancartama Sejati and Perintis Triniti.

Diversification Opportunities for Lancartama Sejati and Perintis Triniti

-0.46

Correlation Coefficient

Lancartama Sejati  Perintis Triniti

Very good diversification

The 3 months correlation between Lancartama and Perintis is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Lancartama Sejati Tbk and Perintis Triniti Properti in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Perintis Triniti Properti and Lancartama Sejati 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 Lancartama Sejati Tbk are associated (or correlated) with Perintis Triniti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Perintis Triniti Properti has no effect on the direction of Lancartama Sejati i.e., Lancartama Sejati and Perintis Triniti go up and down completely randomly.

Pair Corralation between Lancartama Sejati and Perintis Triniti

Assuming the 90 days trading horizon Lancartama Sejati Tbk is expected to generate 1.79 times more return on investment than Perintis Triniti. However, Lancartama Sejati is 1.79 times more volatile than Perintis Triniti Properti. It trades about 0.22 of its potential returns per unit of risk. Perintis Triniti Properti is currently generating about -0.15 per unit of risk. If you would invest  1,400  in Lancartama Sejati Tbk on December 25, 2024 and sell it today you would earn a total of  1,400  from holding Lancartama Sejati Tbk or generate 100.0% return on investment over 90 days.

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

Lancartama Sejati Tbk  vs.  Perintis Triniti Properti

Lancartama Sejati Tbk

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Lancartama Sejati Tbk are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Lancartama Sejati disclosed solid returns over the last few months and may actually be approaching a breakup point.

Perintis Triniti Properti

Risk-Adjusted Performance

Very Weak

Over the last 90 days Perintis Triniti Properti 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.

Pair Trading with Lancartama Sejati and Perintis Triniti

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

The idea behind Lancartama Sejati Tbk and Perintis Triniti Properti 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.