Correlation Between MOVIE GAMES and INDOFOOD AGRI
Can any of the company-specific risk be diversified away by investing in both MOVIE GAMES and INDOFOOD AGRI 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 MOVIE GAMES and INDOFOOD AGRI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MOVIE GAMES SA and INDOFOOD AGRI RES, you can compare the effects of market volatilities on MOVIE GAMES and INDOFOOD AGRI 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 MOVIE GAMES with a short position of INDOFOOD AGRI. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOVIE GAMES and INDOFOOD AGRI.
Diversification Opportunities for MOVIE GAMES and INDOFOOD AGRI
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MOVIE and INDOFOOD is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding MOVIE GAMES SA and INDOFOOD AGRI RES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INDOFOOD AGRI RES and MOVIE GAMES 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 MOVIE GAMES SA are associated (or correlated) with INDOFOOD AGRI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INDOFOOD AGRI RES has no effect on the direction of MOVIE GAMES i.e., MOVIE GAMES and INDOFOOD AGRI go up and down completely randomly.
Pair Corralation between MOVIE GAMES and INDOFOOD AGRI
Assuming the 90 days horizon MOVIE GAMES SA is expected to generate 0.62 times more return on investment than INDOFOOD AGRI. However, MOVIE GAMES SA is 1.62 times less risky than INDOFOOD AGRI. It trades about 0.03 of its potential returns per unit of risk. INDOFOOD AGRI RES is currently generating about -0.14 per unit of risk. If you would invest 406.00 in MOVIE GAMES SA on November 27, 2024 and sell it today you would earn a total of 4.00 from holding MOVIE GAMES SA or generate 0.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MOVIE GAMES SA vs. INDOFOOD AGRI RES
Performance |
| Timeline |
| MOVIE GAMES SA |
| INDOFOOD AGRI RES |
MOVIE GAMES and INDOFOOD AGRI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MOVIE GAMES and INDOFOOD AGRI
The main advantage of trading using opposite MOVIE GAMES and INDOFOOD AGRI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOVIE GAMES position performs unexpectedly, INDOFOOD AGRI 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 INDOFOOD AGRI will offset losses from the drop in INDOFOOD AGRI's long position.| MOVIE GAMES vs. CanSino Biologics | MOVIE GAMES vs. HUTCHISON TELECOMM | MOVIE GAMES vs. Spirent Communications plc | MOVIE GAMES vs. Citic Telecom International |
| INDOFOOD AGRI vs. THAI BEVERAGE | INDOFOOD AGRI vs. BIOPHARMA CREDIT DL | INDOFOOD AGRI vs. Carnegie Clean Energy | INDOFOOD AGRI vs. Discover Financial Services |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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