Correlation Between Adira Dinamika and Mega Manunggal
Can any of the company-specific risk be diversified away by investing in both Adira Dinamika and Mega Manunggal 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 Adira Dinamika and Mega Manunggal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Adira Dinamika Multi and Mega Manunggal Property, you can compare the effects of market volatilities on Adira Dinamika and Mega Manunggal 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 Adira Dinamika with a short position of Mega Manunggal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adira Dinamika and Mega Manunggal.
Diversification Opportunities for Adira Dinamika and Mega Manunggal
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Adira and Mega is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Adira Dinamika Multi and Mega Manunggal Property in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mega Manunggal Property and Adira Dinamika 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 Adira Dinamika Multi are associated (or correlated) with Mega Manunggal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mega Manunggal Property has no effect on the direction of Adira Dinamika i.e., Adira Dinamika and Mega Manunggal go up and down completely randomly.
Pair Corralation between Adira Dinamika and Mega Manunggal
Assuming the 90 days trading horizon Adira Dinamika is expected to generate 8.34 times less return on investment than Mega Manunggal. But when comparing it to its historical volatility, Adira Dinamika Multi is 1.87 times less risky than Mega Manunggal. It trades about 0.02 of its potential returns per unit of risk. Mega Manunggal Property is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 31,000 in Mega Manunggal Property on September 2, 2024 and sell it today you would earn a total of 17,800 from holding Mega Manunggal Property or generate 57.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Adira Dinamika Multi vs. Mega Manunggal Property
Performance |
| Timeline |
| Adira Dinamika Multi |
| Mega Manunggal Property |
Adira Dinamika and Mega Manunggal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adira Dinamika and Mega Manunggal
The main advantage of trading using opposite Adira Dinamika and Mega Manunggal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adira Dinamika position performs unexpectedly, Mega Manunggal 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 Mega Manunggal will offset losses from the drop in Mega Manunggal's long position.| Adira Dinamika vs. Ace Hardware Indonesia | Adira Dinamika vs. Merdeka Copper Gold | Adira Dinamika vs. Mitra Pinasthika Mustika | Adira Dinamika vs. Jakarta Int Hotels |
| Mega Manunggal vs. Lippo Cikarang Tbk | Mega Manunggal vs. Lippo Karawaci Tbk | Mega Manunggal vs. Mitra Pinasthika Mustika | Mega Manunggal vs. Jakarta Int Hotels |
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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