Correlation Between Alam Sutera and Mnc Land
Can any of the company-specific risk be diversified away by investing in both Alam Sutera and Mnc Land 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 Alam Sutera and Mnc Land into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alam Sutera Realty and Mnc Land Tbk, you can compare the effects of market volatilities on Alam Sutera and Mnc Land 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 Alam Sutera with a short position of Mnc Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alam Sutera and Mnc Land.
Diversification Opportunities for Alam Sutera and Mnc Land
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Alam and Mnc is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Alam Sutera Realty and Mnc Land Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mnc Land Tbk and Alam Sutera 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 Alam Sutera Realty are associated (or correlated) with Mnc Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mnc Land Tbk has no effect on the direction of Alam Sutera i.e., Alam Sutera and Mnc Land go up and down completely randomly.
Pair Corralation between Alam Sutera and Mnc Land
Assuming the 90 days trading horizon Alam Sutera Realty is expected to under-perform the Mnc Land. But the stock apears to be less risky and, when comparing its historical volatility, Alam Sutera Realty is 1.74 times less risky than Mnc Land. The stock trades about -0.66 of its potential returns per unit of risk. The Mnc Land Tbk is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 17,100 in Mnc Land Tbk on August 24, 2024 and sell it today you would lose (1,700) from holding Mnc Land Tbk or give up 9.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alam Sutera Realty vs. Mnc Land Tbk
Performance |
| Timeline |
| Alam Sutera Realty |
| Mnc Land Tbk |
Alam Sutera and Mnc Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alam Sutera and Mnc Land
The main advantage of trading using opposite Alam Sutera and Mnc Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alam Sutera position performs unexpectedly, Mnc Land 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 Mnc Land will offset losses from the drop in Mnc Land's long position.| Alam Sutera vs. Bumi Serpong Damai | Alam Sutera vs. Summarecon Agung Tbk | Alam Sutera vs. Lippo Karawaci Tbk | Alam Sutera vs. Ciputra Development Tbk |
| Mnc Land vs. Ciputra Development Tbk | Mnc Land vs. Bumi Serpong Damai | Mnc Land vs. Alam Sutera Realty | Mnc Land vs. Lippo Karawaci Tbk |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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