Correlation Between PT Semen and Wendys
Can any of the company-specific risk be diversified away by investing in both PT Semen and Wendys 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 Semen and Wendys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Semen Indonesia and The Wendys Co, you can compare the effects of market volatilities on PT Semen and Wendys 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 Semen with a short position of Wendys. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Semen and Wendys.
Diversification Opportunities for PT Semen and Wendys
Poor diversification
The 3 months correlation between PSGTF and Wendys is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding PT Semen Indonesia and The Wendys Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Wendys and PT Semen 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 Semen Indonesia are associated (or correlated) with Wendys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Wendys has no effect on the direction of PT Semen i.e., PT Semen and Wendys go up and down completely randomly.
Pair Corralation between PT Semen and Wendys
Assuming the 90 days horizon PT Semen Indonesia is expected to generate 2.71 times more return on investment than Wendys. However, PT Semen is 2.71 times more volatile than The Wendys Co. It trades about -0.04 of its potential returns per unit of risk. The Wendys Co is currently generating about -0.19 per unit of risk. If you would invest 20.00 in PT Semen Indonesia on March 9, 2025 and sell it today you would lose (5.00) from holding PT Semen Indonesia or give up 25.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Semen Indonesia vs. The Wendys Co
Performance |
| Timeline |
| PT Semen Indonesia |
| The Wendys |
PT Semen and Wendys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Semen and Wendys
The main advantage of trading using opposite PT Semen and Wendys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Semen position performs unexpectedly, Wendys 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 Wendys will offset losses from the drop in Wendys' long position.| PT Semen vs. Arrow Electronics | PT Semen vs. Viemed Healthcare | PT Semen vs. Merit Medical Systems | PT Semen vs. Uber Technologies |
| Wendys vs. Yum Brands | Wendys vs. Dominos Pizza Common | Wendys vs. Darden Restaurants | Wendys vs. Papa Johns International |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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