Correlation Between Dosni Roha and Rig Tenders

Can any of the company-specific risk be diversified away by investing in both Dosni Roha and Rig Tenders 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 Dosni Roha and Rig Tenders into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dosni Roha Indonesia and Rig Tenders Tbk, you can compare the effects of market volatilities on Dosni Roha and Rig Tenders 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 Dosni Roha with a short position of Rig Tenders. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dosni Roha and Rig Tenders.

Diversification Opportunities for Dosni Roha and Rig Tenders

0.88

Correlation Coefficient

Dosni Roha  Rig Tenders

Very poor diversification

The 3 months correlation between Dosni and Rig is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Dosni Roha Indonesia and Rig Tenders Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rig Tenders Tbk and Dosni Roha 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 Dosni Roha Indonesia are associated (or correlated) with Rig Tenders. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rig Tenders Tbk has no effect on the direction of Dosni Roha i.e., Dosni Roha and Rig Tenders go up and down completely randomly.

Pair Corralation between Dosni Roha and Rig Tenders

Assuming the 90 days trading horizon Dosni Roha Indonesia is expected to generate 0.31 times more return on investment than Rig Tenders. However, Dosni Roha Indonesia is 3.27 times less risky than Rig Tenders. It trades about -0.09 of its potential returns per unit of risk. Rig Tenders Tbk is currently generating about -0.08 per unit of risk. If you would invest  5,400  in Dosni Roha Indonesia on December 29, 2024 and sell it today you would lose (400.00) from holding Dosni Roha Indonesia or give up 7.41% of portfolio value over 90 days.

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

Dosni Roha Indonesia  vs.  Rig Tenders Tbk

Dosni Roha Indonesia

Risk-Adjusted Performance

Very Weak

Over the last 90 days Dosni Roha Indonesia 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.

Rig Tenders Tbk

Risk-Adjusted Performance

Very Weak

Over the last 90 days Rig Tenders Tbk has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Dosni Roha and Rig Tenders

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

The idea behind Dosni Roha Indonesia and Rig Tenders 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 Transaction History module to view history of all your transactions and understand their impact on performance.