Correlation Between Asuransi Tugu and Surya Permata

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

By analyzing existing cross correlation between Asuransi Tugu Pratama and Surya Permata Andalan, you can compare the effects of market volatilities on Asuransi Tugu and Surya Permata 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 Asuransi Tugu with a short position of Surya Permata. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asuransi Tugu and Surya Permata.

Diversification Opportunities for Asuransi Tugu and Surya Permata

-0.01

Correlation Coefficient

Asuransi Tugu  Surya Permata

Good diversification

The 3 months correlation between Asuransi and Surya is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Asuransi Tugu Pratama and Surya Permata Andalan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Surya Permata Andalan and Asuransi Tugu 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 Asuransi Tugu Pratama are associated (or correlated) with Surya Permata. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Surya Permata Andalan has no effect on the direction of Asuransi Tugu i.e., Asuransi Tugu and Surya Permata go up and down completely randomly.

Pair Corralation between Asuransi Tugu and Surya Permata

Assuming the 90 days trading horizon Asuransi Tugu Pratama is expected to under-perform the Surya Permata. But the stock apears to be less risky and, when comparing its historical volatility, Asuransi Tugu Pratama is 1.21 times less risky than Surya Permata. The stock trades about -0.05 of its potential returns per unit of risk. The Surya Permata Andalan is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  14,800  in Surya Permata Andalan on December 31, 2024 and sell it today you would earn a total of  700.00  from holding Surya Permata Andalan or generate 4.73% return on investment over 90 days.

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

Asuransi Tugu Pratama  vs.  Surya Permata Andalan

Asuransi Tugu Pratama

Risk-Adjusted Performance

Very Weak

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

Surya Permata Andalan

Risk-Adjusted Performance

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Surya Permata Andalan are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Surya Permata 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 Asuransi Tugu and Surya Permata

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

The idea behind Asuransi Tugu Pratama and Surya Permata Andalan 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.