Correlation Between Sumber Alfaria and Mitra Pinasthika
Can any of the company-specific risk be diversified away by investing in both Sumber Alfaria and Mitra Pinasthika 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 Sumber Alfaria and Mitra Pinasthika into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sumber Alfaria Trijaya and Mitra Pinasthika Mustika, you can compare the effects of market volatilities on Sumber Alfaria and Mitra Pinasthika 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 Sumber Alfaria with a short position of Mitra Pinasthika. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sumber Alfaria and Mitra Pinasthika.
Diversification Opportunities for Sumber Alfaria and Mitra Pinasthika
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sumber and Mitra is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Sumber Alfaria Trijaya and Mitra Pinasthika Mustika in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitra Pinasthika Mustika and Sumber Alfaria 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 Sumber Alfaria Trijaya are associated (or correlated) with Mitra Pinasthika. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitra Pinasthika Mustika has no effect on the direction of Sumber Alfaria i.e., Sumber Alfaria and Mitra Pinasthika go up and down completely randomly.
Pair Corralation between Sumber Alfaria and Mitra Pinasthika
Assuming the 90 days trading horizon Sumber Alfaria Trijaya is expected to under-perform the Mitra Pinasthika. In addition to that, Sumber Alfaria is 4.66 times more volatile than Mitra Pinasthika Mustika. It trades about -0.05 of its total potential returns per unit of risk. Mitra Pinasthika Mustika is currently generating about -0.18 per unit of volatility. If you would invest 103,000 in Mitra Pinasthika Mustika on September 12, 2024 and sell it today you would lose (3,500) from holding Mitra Pinasthika Mustika or give up 3.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sumber Alfaria Trijaya vs. Mitra Pinasthika Mustika
Performance |
| Timeline |
| Sumber Alfaria Trijaya |
| Mitra Pinasthika Mustika |
Sumber Alfaria and Mitra Pinasthika Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sumber Alfaria and Mitra Pinasthika
The main advantage of trading using opposite Sumber Alfaria and Mitra Pinasthika positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sumber Alfaria position performs unexpectedly, Mitra Pinasthika 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 Mitra Pinasthika will offset losses from the drop in Mitra Pinasthika's long position.| Sumber Alfaria vs. Elang Mahkota Teknologi | Sumber Alfaria vs. Ace Hardware Indonesia | Sumber Alfaria vs. BFI Finance Indonesia | Sumber Alfaria vs. Tower Bersama Infrastructure |
| Mitra Pinasthika vs. Pembangunan Graha Lestari | Mitra Pinasthika vs. Pembangunan Jaya Ancol | Mitra Pinasthika vs. Hotel Sahid Jaya | Mitra Pinasthika vs. Mitrabara Adiperdana PT |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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