Correlation Between Telkom Indonesia and QUICKSTEP HLDGS

Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and QUICKSTEP HLDGS 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 Telkom Indonesia and QUICKSTEP HLDGS into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Telkom Indonesia Tbk and QUICKSTEP HLDGS, you can compare the effects of market volatilities on Telkom Indonesia and QUICKSTEP HLDGS 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 Telkom Indonesia with a short position of QUICKSTEP HLDGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and QUICKSTEP HLDGS.

Diversification Opportunities for Telkom Indonesia and QUICKSTEP HLDGS

0.0

Correlation Coefficient

Telkom Indonesia  QUICKSTEP HLDGS

Pay attention - limited upside

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

Pair Corralation between Telkom Indonesia and QUICKSTEP HLDGS

If you would invest  15.00  in Telkom Indonesia Tbk on November 20, 2024 and sell it today you would lose (1.00) from holding Telkom Indonesia Tbk or give up 6.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.69%
Values	Daily Returns

Telkom Indonesia Tbk  vs.  QUICKSTEP HLDGS

Telkom Indonesia Tbk

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Telkom Indonesia Tbk are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward indicators, Telkom Indonesia reported solid returns over the last few months and may actually be approaching a breakup point.

QUICKSTEP HLDGS

Risk-Adjusted Performance

OK

Over the last 90 days QUICKSTEP HLDGS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, QUICKSTEP HLDGS is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Telkom Indonesia and QUICKSTEP HLDGS

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

The idea behind Telkom Indonesia Tbk and QUICKSTEP HLDGS 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.