Correlation Between PT Gajah and Semperit Aktiengesellscha

Can any of the company-specific risk be diversified away by investing in both PT Gajah and Semperit Aktiengesellscha 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 PT Gajah and Semperit Aktiengesellscha into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PT Gajah Tunggal and Semperit Aktiengesellschaft Holding, you can compare the effects of market volatilities on PT Gajah and Semperit Aktiengesellscha 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 PT Gajah with a short position of Semperit Aktiengesellscha. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Gajah and Semperit Aktiengesellscha.

Diversification Opportunities for PT Gajah and Semperit Aktiengesellscha

0.19

Correlation Coefficient

PT Gajah  Semperit Aktiengesellscha

Average diversification

The 3 months correlation between GH8 and Semperit is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding PT Gajah Tunggal and Semperit Aktiengesellschaft Ho in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Semperit Aktiengesellscha and PT Gajah 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 PT Gajah Tunggal are associated (or correlated) with Semperit Aktiengesellscha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Semperit Aktiengesellscha has no effect on the direction of PT Gajah i.e., PT Gajah and Semperit Aktiengesellscha go up and down completely randomly.

Pair Corralation between PT Gajah and Semperit Aktiengesellscha

Assuming the 90 days horizon PT Gajah Tunggal is expected to generate 3.91 times more return on investment than Semperit Aktiengesellscha. However, PT Gajah is 3.91 times more volatile than Semperit Aktiengesellschaft Holding. It trades about 0.07 of its potential returns per unit of risk. Semperit Aktiengesellschaft Holding is currently generating about -0.01 per unit of risk. If you would invest  3.57  in PT Gajah Tunggal on April 23, 2025 and sell it today you would earn a total of  0.73  from holding PT Gajah Tunggal or generate 20.45% return on investment over 90 days.

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

PT Gajah Tunggal  vs.  Semperit Aktiengesellschaft Ho

PT Gajah Tunggal

Risk-Adjusted Performance

Very Weak

Over the last 90 days PT Gajah Tunggal has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly weak basic indicators, PT Gajah reported solid returns over the last few months and may actually be approaching a breakup point.

Semperit Aktiengesellscha

Risk-Adjusted Performance

Very Weak

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

Pair Trading with PT Gajah and Semperit Aktiengesellscha

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

The idea behind PT Gajah Tunggal and Semperit Aktiengesellschaft Holding 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.

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.