Correlation Between Telkom Indonesia and Semperit Aktiengesellscha

Can any of the company-specific risk be diversified away by investing in both Telkom Indonesia 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 Telkom Indonesia and Semperit Aktiengesellscha 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 Semperit Aktiengesellschaft Holding, you can compare the effects of market volatilities on Telkom Indonesia 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 Telkom Indonesia with a short position of Semperit Aktiengesellscha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Telkom Indonesia and Semperit Aktiengesellscha.

Diversification Opportunities for Telkom Indonesia and Semperit Aktiengesellscha

0.65

Correlation Coefficient

Telkom Indonesia  Semperit Aktiengesellscha

Poor diversification

The 3 months correlation between Telkom and Semperit is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Telkom Indonesia Tbk and Semperit Aktiengesellschaft Ho in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Semperit Aktiengesellscha 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 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 Telkom Indonesia i.e., Telkom Indonesia and Semperit Aktiengesellscha go up and down completely randomly.

Pair Corralation between Telkom Indonesia and Semperit Aktiengesellscha

Assuming the 90 days trading horizon Telkom Indonesia Tbk is expected to generate 1.97 times more return on investment than Semperit Aktiengesellscha. However, Telkom Indonesia is 1.97 times more volatile than Semperit Aktiengesellschaft Holding. It trades about 0.05 of its potential returns per unit of risk. Semperit Aktiengesellschaft Holding is currently generating about 0.02 per unit of risk. If you would invest  12.00  in Telkom Indonesia Tbk on April 24, 2025 and sell it today you would earn a total of  1.00  from holding Telkom Indonesia Tbk or generate 8.33% return on investment over 90 days.

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

Telkom Indonesia Tbk  vs.  Semperit Aktiengesellschaft Ho

Telkom Indonesia Tbk

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Telkom Indonesia Tbk are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile technical and fundamental indicators, Telkom Indonesia may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Semperit Aktiengesellscha

Risk-Adjusted Performance

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 current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Telkom Indonesia and Semperit Aktiengesellscha

The main advantage of trading using opposite Telkom Indonesia and Semperit Aktiengesellscha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Telkom Indonesia 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 Telkom Indonesia Tbk 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.

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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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.