Correlation Between Telkom Indonesia and AVEVA Group

Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia and AVEVA Group 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 Telkom Indonesia and AVEVA Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

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

Diversification Opportunities for Telkom Indonesia and AVEVA Group

-0.87

Correlation Coefficient

Telkom Indonesia  AVEVA Group

Pay attention - limited upside

The 3 months correlation between Telkom and AVEVA is -0.87. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and AVEVA Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AVEVA Group PLC and Telkom Indonesia 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 Telkom Indonesia Tbk are associated (or correlated) with AVEVA Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AVEVA Group PLC has no effect on the direction of Telkom Indonesia i.e., Telkom Indonesia and AVEVA Group go up and down completely randomly.

Pair Corralation between Telkom Indonesia and AVEVA Group

If you would invest  3,972  in AVEVA Group PLC on February 19, 2024 and sell it today you would earn a total of  0.00  from holding AVEVA Group PLC or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	1.54%
Values	Daily Returns

Telkom Indonesia Tbk  vs.  AVEVA Group PLC

Telkom Indonesia Tbk

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Telkom Indonesia 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 essential indicators remain quite persistent which may send shares a bit higher in June 2024. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

AVEVA Group PLC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days AVEVA Group PLC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, AVEVA Group is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Telkom Indonesia and AVEVA Group

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

The idea behind Telkom Indonesia Tbk and AVEVA Group PLC 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.