Correlation Between Pelayaran Nasional and Bumi Resources
Can any of the company-specific risk be diversified away by investing in both Pelayaran Nasional and Bumi 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 Pelayaran Nasional and Bumi Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pelayaran Nasional Bina and Bumi Resources Minerals, you can compare the effects of market volatilities on Pelayaran Nasional and Bumi 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 Pelayaran Nasional with a short position of Bumi Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pelayaran Nasional and Bumi Resources.
Diversification Opportunities for Pelayaran Nasional and Bumi Resources
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Pelayaran and Bumi is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Pelayaran Nasional Bina and Bumi Resources Minerals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bumi Resources Minerals and Pelayaran Nasional 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 Pelayaran Nasional Bina are associated (or correlated) with Bumi Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bumi Resources Minerals has no effect on the direction of Pelayaran Nasional i.e., Pelayaran Nasional and Bumi Resources go up and down completely randomly.
Pair Corralation between Pelayaran Nasional and Bumi Resources
Assuming the 90 days trading horizon Pelayaran Nasional Bina is expected to generate 0.9 times more return on investment than Bumi Resources. However, Pelayaran Nasional Bina is 1.11 times less risky than Bumi Resources. It trades about 0.1 of its potential returns per unit of risk. Bumi Resources Minerals is currently generating about 0.07 per unit of risk. If you would invest 6,400 in Pelayaran Nasional Bina on January 29, 2024 and sell it today you would earn a total of 500.00 from holding Pelayaran Nasional Bina or generate 7.81% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Pelayaran Nasional Bina vs. Bumi Resources Minerals
Performance |
Timeline |
Pelayaran Nasional Bina |
Bumi Resources Minerals |
Pelayaran Nasional and Bumi Resources Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Pelayaran Nasional and Bumi Resources
The main advantage of trading using opposite Pelayaran Nasional and Bumi Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pelayaran Nasional position performs unexpectedly, Bumi 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 Bumi Resources will offset losses from the drop in Bumi Resources' long position.Pelayaran Nasional vs. Capitol Nusantara Indonesia | Pelayaran Nasional vs. Logindo Samudramakmur Tbk | Pelayaran Nasional vs. Wintermar Offshore Marine | Pelayaran Nasional vs. Buana Listya Tama |
Bumi Resources vs. Energi Mega Persada | Bumi Resources vs. Harum Energy Tbk | Bumi Resources vs. Delta Dunia Makmur | Bumi Resources vs. Benakat Petroleum Energy |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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