Correlation Between Yanaprima Hastapersada and Trias Sentosa

Can any of the company-specific risk be diversified away by investing in both Yanaprima Hastapersada and Trias Sentosa 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 Yanaprima Hastapersada and Trias Sentosa into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Yanaprima Hastapersada and Trias Sentosa

0.24

Correlation Coefficient

Yanaprima Hastapersada  Trias Sentosa

Modest diversification

The 3 months correlation between Yanaprima and Trias is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Yanaprima Hastapersada Tbk and Trias Sentosa Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trias Sentosa Tbk and Yanaprima Hastapersada 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 Yanaprima Hastapersada Tbk are associated (or correlated) with Trias Sentosa. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trias Sentosa Tbk has no effect on the direction of Yanaprima Hastapersada i.e., Yanaprima Hastapersada and Trias Sentosa go up and down completely randomly.

Pair Corralation between Yanaprima Hastapersada and Trias Sentosa

Assuming the 90 days trading horizon Yanaprima Hastapersada is expected to generate 2.55 times less return on investment than Trias Sentosa. In addition to that, Yanaprima Hastapersada is 1.27 times more volatile than Trias Sentosa Tbk. It trades about 0.01 of its total potential returns per unit of risk. Trias Sentosa Tbk is currently generating about 0.04 per unit of volatility. If you would invest  47,200  in Trias Sentosa Tbk on October 12, 2024 and sell it today you would earn a total of  7,800  from holding Trias Sentosa Tbk or generate 16.53% return on investment over 90 days.

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

Yanaprima Hastapersada Tbk  vs.  Trias Sentosa Tbk

Yanaprima Hastapersada

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Yanaprima Hastapersada Tbk are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Yanaprima Hastapersada disclosed solid returns over the last few months and may actually be approaching a breakup point.

Trias Sentosa Tbk

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Trias Sentosa Tbk are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Trias Sentosa disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Yanaprima Hastapersada and Trias Sentosa

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

The idea behind Yanaprima Hastapersada Tbk and Trias Sentosa 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.