Correlation Between Telkom Indonesia and Forbion European

Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and Forbion European 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 Forbion European 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 Forbion European Acquisition, you can compare the effects of market volatilities on Telkom Indonesia and Forbion European 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 Forbion European. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and Forbion European.

Diversification Opportunities for Telkom Indonesia and Forbion European

-0.82

Correlation Coefficient

Telkom Indonesia  Forbion European

Pay attention - limited upside

The 3 months correlation between Telkom and Forbion is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and Forbion European Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Forbion European Acq 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 Forbion European. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Forbion European Acq has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and Forbion European go up and down completely randomly.

Pair Corralation between Telkom Indonesia and Forbion European

If you would invest  1,077  in Forbion European Acquisition on October 11, 2024 and sell it today you would earn a total of  0.00  from holding Forbion European Acquisition or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	1.64%
Values	Daily Returns

Telkom Indonesia Tbk  vs.  Forbion European Acquisition

Telkom Indonesia Tbk

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Telkom Indonesia Tbk 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 essential indicators remain quite persistent which may send shares a bit higher in February 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Forbion European Acq

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Forbion European Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy fundamental drivers, Forbion European is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Telkom Indonesia and Forbion European

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

The idea behind Telkom Indonesia Tbk and Forbion European Acquisition 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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.