Correlation Between Surya Toto and Jasuindo Tiga

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

By analyzing existing cross correlation between Surya Toto Indonesia and Jasuindo Tiga Perkasa, you can compare the effects of market volatilities on Surya Toto and Jasuindo Tiga 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 Toto with a short position of Jasuindo Tiga. Check out your portfolio center. Please also check ongoing floating volatility patterns of Surya Toto and Jasuindo Tiga.

Diversification Opportunities for Surya Toto and Jasuindo Tiga

0.42

Correlation Coefficient

Surya Toto  Jasuindo Tiga

Very weak diversification

The 3 months correlation between Surya and Jasuindo is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Surya Toto Indonesia and Jasuindo Tiga Perkasa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jasuindo Tiga Perkasa and Surya Toto 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 Toto Indonesia are associated (or correlated) with Jasuindo Tiga. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jasuindo Tiga Perkasa has no effect on the direction of Surya Toto i.e., Surya Toto and Jasuindo Tiga go up and down completely randomly.

Pair Corralation between Surya Toto and Jasuindo Tiga

Assuming the 90 days trading horizon Surya Toto Indonesia is expected to under-perform the Jasuindo Tiga. In addition to that, Surya Toto is 1.14 times more volatile than Jasuindo Tiga Perkasa. It trades about -0.16 of its total potential returns per unit of risk. Jasuindo Tiga Perkasa is currently generating about 0.19 per unit of volatility. If you would invest  21,200  in Jasuindo Tiga Perkasa on December 5, 2024 and sell it today you would earn a total of  1,000.00  from holding Jasuindo Tiga Perkasa or generate 4.72% return on investment over 90 days.

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

Surya Toto Indonesia  vs.  Jasuindo Tiga Perkasa

Surya Toto Indonesia

Risk-Adjusted Performance

Very Weak

Over the last 90 days Surya Toto Indonesia 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.

Jasuindo Tiga Perkasa

Risk-Adjusted Performance

Very Weak

Over the last 90 days Jasuindo Tiga Perkasa has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent forward-looking signals, Jasuindo Tiga is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Surya Toto and Jasuindo Tiga

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

The idea behind Surya Toto Indonesia and Jasuindo Tiga Perkasa 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.