Correlation Between Iluka Resources and PT Indah

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

By analyzing existing cross correlation between Iluka Resources Limited and PT Indah Kiat, you can compare the effects of market volatilities on Iluka Resources and PT Indah 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 Iluka Resources with a short position of PT Indah. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iluka Resources and PT Indah.

Diversification Opportunities for Iluka Resources and PT Indah

0.0

Correlation Coefficient

Iluka Resources  PT Indah

Pay attention - limited upside

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

Pair Corralation between Iluka Resources and PT Indah

If you would invest  440.00  in Iluka Resources Limited on July 27, 2025 and sell it today you would earn a total of  65.00  from holding Iluka Resources Limited or generate 14.77% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	4.55%
Values	Daily Returns

Iluka Resources Limited  vs.  PT Indah Kiat

Iluka Resources

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Iluka Resources Limited are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Iluka Resources reported solid returns over the last few months and may actually be approaching a breakup point.

PT Indah Kiat

Risk-Adjusted Performance

Weakest

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

Pair Trading with Iluka Resources and PT Indah

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

The idea behind Iluka Resources Limited and PT Indah Kiat 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.