Correlation Between Trimegah Securities and Panin Sekuritas

Can any of the company-specific risk be diversified away by investing in both Trimegah Securities and Panin Sekuritas 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 Trimegah Securities and Panin Sekuritas into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Trimegah Securities and Panin Sekuritas

0.37

Correlation Coefficient

Trimegah Securities  Panin Sekuritas

Weak diversification

The 3 months correlation between Trimegah and Panin is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Trimegah Securities Tbk and Panin Sekuritas Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Panin Sekuritas Tbk and Trimegah Securities 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 Trimegah Securities Tbk are associated (or correlated) with Panin Sekuritas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Panin Sekuritas Tbk has no effect on the direction of Trimegah Securities i.e., Trimegah Securities and Panin Sekuritas go up and down completely randomly.

Pair Corralation between Trimegah Securities and Panin Sekuritas

Assuming the 90 days trading horizon Trimegah Securities Tbk is expected to generate 2.99 times more return on investment than Panin Sekuritas. However, Trimegah Securities is 2.99 times more volatile than Panin Sekuritas Tbk. It trades about 0.05 of its potential returns per unit of risk. Panin Sekuritas Tbk is currently generating about -0.17 per unit of risk. If you would invest  36,000  in Trimegah Securities Tbk on December 31, 2024 and sell it today you would earn a total of  2,000  from holding Trimegah Securities Tbk or generate 5.56% return on investment over 90 days.

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

Trimegah Securities Tbk  vs.  Panin Sekuritas Tbk

Trimegah Securities Tbk

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Trimegah Securities Tbk are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Trimegah Securities may actually be approaching a critical reversion point that can send shares even higher in May 2025.

Panin Sekuritas Tbk

Risk-Adjusted Performance

Very Weak

Over the last 90 days Panin Sekuritas Tbk 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.

Pair Trading with Trimegah Securities and Panin Sekuritas

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

The idea behind Trimegah Securities Tbk and Panin Sekuritas Tbk 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.