Correlation Between Tera Data and Global Mediacom
Can any of the company-specific risk be diversified away by investing in both Tera Data and Global Mediacom 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 Tera Data and Global Mediacom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tera Data Indonusa and Global Mediacom Tbk, you can compare the effects of market volatilities on Tera Data and Global Mediacom 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 Tera Data with a short position of Global Mediacom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tera Data and Global Mediacom.
Diversification Opportunities for Tera Data and Global Mediacom
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Tera and Global is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Tera Data Indonusa and Global Mediacom Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Mediacom Tbk and Tera Data 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 Tera Data Indonusa are associated (or correlated) with Global Mediacom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Mediacom Tbk has no effect on the direction of Tera Data i.e., Tera Data and Global Mediacom go up and down completely randomly.
Pair Corralation between Tera Data and Global Mediacom
Assuming the 90 days trading horizon Tera Data Indonusa is expected to generate 1.11 times more return on investment than Global Mediacom. However, Tera Data is 1.11 times more volatile than Global Mediacom Tbk. It trades about 0.12 of its potential returns per unit of risk. Global Mediacom Tbk is currently generating about -0.25 per unit of risk. If you would invest 11,716 in Tera Data Indonusa on September 2, 2024 and sell it today you would earn a total of 484.00 from holding Tera Data Indonusa or generate 4.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tera Data Indonusa vs. Global Mediacom Tbk
Performance |
| Timeline |
| Tera Data Indonusa |
| Global Mediacom Tbk |
Tera Data and Global Mediacom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tera Data and Global Mediacom
The main advantage of trading using opposite Tera Data and Global Mediacom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tera Data position performs unexpectedly, Global Mediacom 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 Global Mediacom will offset losses from the drop in Global Mediacom's long position.| Tera Data vs. PT Dewi Shri | Tera Data vs. Habco Trans Maritima | Tera Data vs. PT Jhonlin Agro | Tera Data vs. Autopedia Sukses Lestari |
| Global Mediacom vs. Indosat Tbk | Global Mediacom vs. XL Axiata Tbk | Global Mediacom vs. Energi Mega Persada | Global Mediacom vs. Bakrie Brothers 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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