Correlation Between Integra Indocabinet and J Resources

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Integra Indocabinet and J Resources 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 Integra Indocabinet and J Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Integra Indocabinet Tbk and J Resources Asia, you can compare the effects of market volatilities on Integra Indocabinet and J Resources 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 Integra Indocabinet with a short position of J Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Integra Indocabinet and J Resources.

Diversification Opportunities for Integra Indocabinet and J Resources

0.73
  Correlation Coefficient

Poor diversification

The 3 months correlation between Integra and PSAB is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Integra Indocabinet Tbk and J Resources Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on J Resources Asia and Integra Indocabinet 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 Integra Indocabinet Tbk are associated (or correlated) with J Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of J Resources Asia has no effect on the direction of Integra Indocabinet i.e., Integra Indocabinet and J Resources go up and down completely randomly.

Pair Corralation between Integra Indocabinet and J Resources

Assuming the 90 days trading horizon Integra Indocabinet is expected to generate 1.15 times less return on investment than J Resources. But when comparing it to its historical volatility, Integra Indocabinet Tbk is 1.33 times less risky than J Resources. It trades about 0.12 of its potential returns per unit of risk. J Resources Asia is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  23,000  in J Resources Asia on September 2, 2024 and sell it today you would earn a total of  7,200  from holding J Resources Asia or generate 31.3% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Integra Indocabinet Tbk  vs.  J Resources Asia

 Performance 
       Timeline  
Integra Indocabinet Tbk 

Risk-Adjusted Performance

9 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Integra Indocabinet Tbk are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Integra Indocabinet disclosed solid returns over the last few months and may actually be approaching a breakup point.
J Resources Asia 

Risk-Adjusted Performance

8 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in J Resources Asia are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, J Resources disclosed solid returns over the last few months and may actually be approaching a breakup point.

Integra Indocabinet and J Resources Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Integra Indocabinet and J Resources

The main advantage of trading using opposite Integra Indocabinet and J Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Integra Indocabinet position performs unexpectedly, J Resources 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 J Resources will offset losses from the drop in J Resources' long position.
The idea behind Integra Indocabinet Tbk and J Resources Asia 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.

Other Complementary Tools

Stock Screener
Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook.
Piotroski F Score
Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals
Global Markets Map
Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes
Stocks Directory
Find actively traded stocks across global markets
Volatility Analysis
Get historical volatility and risk analysis based on latest market data