Correlation Between Telkom Indonesia and Sterling Check

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

Diversification Opportunities for Telkom Indonesia and Sterling Check

-0.84
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Telkom and Sterling is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and Sterling Check Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Check Corp 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 Sterling Check. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sterling Check Corp has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and Sterling Check go up and down completely randomly.

Pair Corralation between Telkom Indonesia and Sterling Check

If you would invest  1,674  in Sterling Check Corp on October 6, 2024 and sell it today you would earn a total of  0.00  from holding Sterling Check Corp or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthSignificant
Accuracy5.0%
ValuesDaily Returns

Telkom Indonesia Tbk  vs.  Sterling Check Corp

 Performance 
       Timeline  
Telkom Indonesia Tbk 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
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 latest conflicting performance, the Stock's essential indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.
Sterling Check Corp 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Weak
Over the last 90 days Sterling Check Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical and fundamental indicators, Sterling Check is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Telkom Indonesia and Sterling Check Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Telkom Indonesia and Sterling Check

The main advantage of trading using opposite Telkom Indonesia and Sterling Check positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia position performs unexpectedly, Sterling Check 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 Sterling Check will offset losses from the drop in Sterling Check's long position.
The idea behind Telkom Indonesia Tbk and Sterling Check Corp 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.
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..

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