Correlation Between Red Planet and Pembangunan Graha

Can any of the company-specific risk be diversified away by investing in both Red Planet and Pembangunan Graha 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 Red Planet and Pembangunan Graha into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Red Planet Indonesia and Pembangunan Graha Lestari, you can compare the effects of market volatilities on Red Planet and Pembangunan Graha 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 Red Planet with a short position of Pembangunan Graha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Red Planet and Pembangunan Graha.

Diversification Opportunities for Red Planet and Pembangunan Graha

0.0

Correlation Coefficient

Red Planet  Pembangunan Graha

Pay attention - limited upside

The 3 months correlation between Red and Pembangunan is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Red Planet Indonesia and Pembangunan Graha Lestari in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pembangunan Graha Lestari and Red Planet 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 Red Planet Indonesia are associated (or correlated) with Pembangunan Graha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pembangunan Graha Lestari has no effect on the direction of Red Planet i.e., Red Planet and Pembangunan Graha go up and down completely randomly.

Pair Corralation between Red Planet and Pembangunan Graha

If you would invest  2,200  in Red Planet Indonesia on February 7, 2024 and sell it today you would earn a total of  0.00  from holding Red Planet Indonesia or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	6.67%
Values	Daily Returns

Red Planet Indonesia  vs.  Pembangunan Graha Lestari

Red Planet Indonesia

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Red Planet Indonesia has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic 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.

Pembangunan Graha Lestari

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Pembangunan Graha Lestari has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic 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.

Pair Trading with Red Planet and Pembangunan Graha

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

The idea behind Red Planet Indonesia and Pembangunan Graha Lestari 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.