Correlation Between Mnc Investama and Humpuss Intermoda
Can any of the company-specific risk be diversified away by investing in both Mnc Investama and Humpuss Intermoda 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 Mnc Investama and Humpuss Intermoda into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mnc Investama Tbk and Humpuss Intermoda Transportasi, you can compare the effects of market volatilities on Mnc Investama and Humpuss Intermoda 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 Mnc Investama with a short position of Humpuss Intermoda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mnc Investama and Humpuss Intermoda.
Diversification Opportunities for Mnc Investama and Humpuss Intermoda
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mnc and Humpuss is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Mnc Investama Tbk and Humpuss Intermoda Transportasi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Humpuss Intermoda and Mnc Investama 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 Mnc Investama Tbk are associated (or correlated) with Humpuss Intermoda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Humpuss Intermoda has no effect on the direction of Mnc Investama i.e., Mnc Investama and Humpuss Intermoda go up and down completely randomly.
Pair Corralation between Mnc Investama and Humpuss Intermoda
Assuming the 90 days trading horizon Mnc Investama Tbk is expected to under-perform the Humpuss Intermoda. But the stock apears to be less risky and, when comparing its historical volatility, Mnc Investama Tbk is 2.15 times less risky than Humpuss Intermoda. The stock trades about -0.2 of its potential returns per unit of risk. The Humpuss Intermoda Transportasi is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 30,200 in Humpuss Intermoda Transportasi on October 25, 2024 and sell it today you would earn a total of 5,800 from holding Humpuss Intermoda Transportasi or generate 19.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mnc Investama Tbk vs. Humpuss Intermoda Transportasi
Performance |
| Timeline |
| Mnc Investama Tbk |
| Humpuss Intermoda |
Mnc Investama and Humpuss Intermoda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mnc Investama and Humpuss Intermoda
The main advantage of trading using opposite Mnc Investama and Humpuss Intermoda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mnc Investama position performs unexpectedly, Humpuss Intermoda 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 Humpuss Intermoda will offset losses from the drop in Humpuss Intermoda's long position.| Mnc Investama vs. Global Mediacom Tbk | Mnc Investama vs. Sentul City Tbk | Mnc Investama vs. Kawasan Industri Jababeka | Mnc Investama vs. Energi Mega Persada |
| Humpuss Intermoda vs. Tanah Laut Tbk | Humpuss Intermoda vs. Indorama Synthetics Tbk | Humpuss Intermoda vs. Rig Tenders Tbk | Humpuss Intermoda vs. Integra Indocabinet 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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