Correlation Between Garudafood Putra and Vale Indonesia
Can any of the company-specific risk be diversified away by investing in both Garudafood Putra and Vale Indonesia 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 Garudafood Putra and Vale Indonesia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Garudafood Putra Putri and Vale Indonesia Tbk, you can compare the effects of market volatilities on Garudafood Putra and Vale Indonesia 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 Garudafood Putra with a short position of Vale Indonesia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Garudafood Putra and Vale Indonesia.
Diversification Opportunities for Garudafood Putra and Vale Indonesia
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Garudafood and Vale is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Garudafood Putra Putri and Vale Indonesia Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vale Indonesia Tbk and Garudafood Putra 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 Garudafood Putra Putri are associated (or correlated) with Vale Indonesia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vale Indonesia Tbk has no effect on the direction of Garudafood Putra i.e., Garudafood Putra and Vale Indonesia go up and down completely randomly.
Pair Corralation between Garudafood Putra and Vale Indonesia
Assuming the 90 days trading horizon Garudafood Putra Putri is expected to generate 0.47 times more return on investment than Vale Indonesia. However, Garudafood Putra Putri is 2.12 times less risky than Vale Indonesia. It trades about 0.0 of its potential returns per unit of risk. Vale Indonesia Tbk is currently generating about -0.28 per unit of risk. If you would invest 42,000 in Garudafood Putra Putri on February 7, 2024 and sell it today you would earn a total of 0.00 from holding Garudafood Putra Putri or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Garudafood Putra Putri vs. Vale Indonesia Tbk
Performance |
Timeline |
Garudafood Putra Putri |
Vale Indonesia Tbk |
Garudafood Putra and Vale Indonesia Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Garudafood Putra and Vale Indonesia
The main advantage of trading using opposite Garudafood Putra and Vale Indonesia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Garudafood Putra position performs unexpectedly, Vale Indonesia 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 Vale Indonesia will offset losses from the drop in Vale Indonesia's long position.Garudafood Putra vs. Fast Food Indonesia | Garudafood Putra vs. Enseval Putra Megatrading | Garudafood Putra vs. Hexindo Adiperkasa Tbk | Garudafood Putra vs. Astra Graphia Tbk |
Vale Indonesia vs. Timah Persero Tbk | Vale Indonesia vs. Aneka Tambang Persero | Vale Indonesia vs. Bukit Asam Tbk | Vale Indonesia vs. Perusahaan Gas Negara |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
Transaction History View history of all your transactions and understand their impact on performance |