Correlation Between Weha Transportasi and First Media
Can any of the company-specific risk be diversified away by investing in both Weha Transportasi and First Media 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 Weha Transportasi and First Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Weha Transportasi Indonesia and First Media Tbk, you can compare the effects of market volatilities on Weha Transportasi and First Media 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 Weha Transportasi with a short position of First Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weha Transportasi and First Media.
Diversification Opportunities for Weha Transportasi and First Media
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Weha and First is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Weha Transportasi Indonesia and First Media Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Media Tbk and Weha Transportasi 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 Weha Transportasi Indonesia are associated (or correlated) with First Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Media Tbk has no effect on the direction of Weha Transportasi i.e., Weha Transportasi and First Media go up and down completely randomly.
Pair Corralation between Weha Transportasi and First Media
Assuming the 90 days trading horizon Weha Transportasi Indonesia is expected to under-perform the First Media. In addition to that, Weha Transportasi is 1.15 times more volatile than First Media Tbk. It trades about -0.06 of its total potential returns per unit of risk. First Media Tbk is currently generating about 0.0 per unit of volatility. If you would invest 9,000 in First Media Tbk on December 28, 2024 and sell it today you would lose (100.00) from holding First Media Tbk or give up 1.11% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Weha Transportasi Indonesia vs. First Media Tbk
Performance |
Timeline |
Weha Transportasi |
First Media Tbk |
Weha Transportasi and First Media Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Weha Transportasi and First Media
The main advantage of trading using opposite Weha Transportasi and First Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weha Transportasi position performs unexpectedly, First Media 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 First Media will offset losses from the drop in First Media's long position.Weha Transportasi vs. PT Temas Tbk | Weha Transportasi vs. Dosni Roha Indonesia | Weha Transportasi vs. Rig Tenders Tbk | Weha Transportasi vs. Samudera Indonesia Tbk |
First Media vs. Alumindo Light Metal | First Media vs. Garuda Metalindo Tbk | First Media vs. Metrodata Electronics Tbk | First Media vs. Weha Transportasi Indonesia |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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