Correlation Between Arwana Citramulia and Mark Dynamics
Can any of the company-specific risk be diversified away by investing in both Arwana Citramulia and Mark Dynamics 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 Arwana Citramulia and Mark Dynamics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arwana Citramulia Tbk and Mark Dynamics Indonesia, you can compare the effects of market volatilities on Arwana Citramulia and Mark Dynamics 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 Arwana Citramulia with a short position of Mark Dynamics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arwana Citramulia and Mark Dynamics.
Diversification Opportunities for Arwana Citramulia and Mark Dynamics
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Arwana and Mark is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Arwana Citramulia Tbk and Mark Dynamics Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mark Dynamics Indonesia and Arwana Citramulia 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 Arwana Citramulia Tbk are associated (or correlated) with Mark Dynamics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mark Dynamics Indonesia has no effect on the direction of Arwana Citramulia i.e., Arwana Citramulia and Mark Dynamics go up and down completely randomly.
Pair Corralation between Arwana Citramulia and Mark Dynamics
Assuming the 90 days trading horizon Arwana Citramulia Tbk is expected to under-perform the Mark Dynamics. But the stock apears to be less risky and, when comparing its historical volatility, Arwana Citramulia Tbk is 1.91 times less risky than Mark Dynamics. The stock trades about -0.02 of its potential returns per unit of risk. The Mark Dynamics Indonesia is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 56,805 in Mark Dynamics Indonesia on August 29, 2024 and sell it today you would earn a total of 47,195 from holding Mark Dynamics Indonesia or generate 83.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.73% |
| Values | Daily Returns |
Arwana Citramulia Tbk vs. Mark Dynamics Indonesia
Performance |
| Timeline |
| Arwana Citramulia Tbk |
| Mark Dynamics Indonesia |
Arwana Citramulia and Mark Dynamics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arwana Citramulia and Mark Dynamics
The main advantage of trading using opposite Arwana Citramulia and Mark Dynamics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arwana Citramulia position performs unexpectedly, Mark Dynamics 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 Mark Dynamics will offset losses from the drop in Mark Dynamics' long position.| Arwana Citramulia vs. Asahimas Flat Glass | Arwana Citramulia vs. Astra Graphia Tbk | Arwana Citramulia vs. Ekadharma International Tbk | Arwana Citramulia vs. Akasha Wira 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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