Correlation Between Arwana Citramulia and Hero Supermarket
Can any of the company-specific risk be diversified away by investing in both Arwana Citramulia and Hero Supermarket 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 Arwana Citramulia and Hero Supermarket into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arwana Citramulia Tbk and Hero Supermarket Tbk, you can compare the effects of market volatilities on Arwana Citramulia and Hero Supermarket 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 Arwana Citramulia with a short position of Hero Supermarket. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arwana Citramulia and Hero Supermarket.
Diversification Opportunities for Arwana Citramulia and Hero Supermarket
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Arwana and Hero is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Arwana Citramulia Tbk and Hero Supermarket Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hero Supermarket Tbk and Arwana Citramulia 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 Arwana Citramulia Tbk are associated (or correlated) with Hero Supermarket. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hero Supermarket Tbk has no effect on the direction of Arwana Citramulia i.e., Arwana Citramulia and Hero Supermarket go up and down completely randomly.
Pair Corralation between Arwana Citramulia and Hero Supermarket
Assuming the 90 days trading horizon Arwana Citramulia Tbk is expected to generate 0.97 times more return on investment than Hero Supermarket. However, Arwana Citramulia Tbk is 1.04 times less risky than Hero Supermarket. It trades about 0.04 of its potential returns per unit of risk. Hero Supermarket Tbk is currently generating about 0.01 per unit of risk. If you would invest 66,260 in Arwana Citramulia Tbk on January 26, 2024 and sell it today you would earn a total of 740.00 from holding Arwana Citramulia Tbk or generate 1.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arwana Citramulia Tbk vs. Hero Supermarket Tbk
Performance |
| Timeline |
| Arwana Citramulia Tbk |
| Hero Supermarket Tbk |
Arwana Citramulia and Hero Supermarket Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arwana Citramulia and Hero Supermarket
The main advantage of trading using opposite Arwana Citramulia and Hero Supermarket positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arwana Citramulia position performs unexpectedly, Hero Supermarket 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 Hero Supermarket will offset losses from the drop in Hero Supermarket's long position.| Arwana Citramulia vs. Asahimas Flat Glass | Arwana Citramulia vs. Astra Graphia Tbk | Arwana Citramulia vs. Akasha Wira International | Arwana Citramulia vs. Asiaplast Industries Tbk |
| Hero Supermarket vs. Fast Food Indonesia | Hero Supermarket vs. Enseval Putra Megatrading | Hero Supermarket vs. Matahari Putra Prima | Hero Supermarket vs. Hexindo Adiperkasa Tbk |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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