Correlation Between Global Mediacom and Dharma Polimetal
Can any of the company-specific risk be diversified away by investing in both Global Mediacom and Dharma Polimetal 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 Global Mediacom and Dharma Polimetal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Mediacom Tbk and Dharma Polimetal Tbk, you can compare the effects of market volatilities on Global Mediacom and Dharma Polimetal 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 Global Mediacom with a short position of Dharma Polimetal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Mediacom and Dharma Polimetal.
Diversification Opportunities for Global Mediacom and Dharma Polimetal
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Global and Dharma is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Global Mediacom Tbk and Dharma Polimetal Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dharma Polimetal Tbk and Global Mediacom 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 Global Mediacom Tbk are associated (or correlated) with Dharma Polimetal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dharma Polimetal Tbk has no effect on the direction of Global Mediacom i.e., Global Mediacom and Dharma Polimetal go up and down completely randomly.
Pair Corralation between Global Mediacom and Dharma Polimetal
Assuming the 90 days trading horizon Global Mediacom Tbk is expected to under-perform the Dharma Polimetal. But the stock apears to be less risky and, when comparing its historical volatility, Global Mediacom Tbk is 1.15 times less risky than Dharma Polimetal. The stock trades about -0.06 of its potential returns per unit of risk. The Dharma Polimetal Tbk is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 122,002 in Dharma Polimetal Tbk on November 4, 2024 and sell it today you would lose (29,002) from holding Dharma Polimetal Tbk or give up 23.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Mediacom Tbk vs. Dharma Polimetal Tbk
Performance |
| Timeline |
| Global Mediacom Tbk |
| Dharma Polimetal Tbk |
Global Mediacom and Dharma Polimetal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Mediacom and Dharma Polimetal
The main advantage of trading using opposite Global Mediacom and Dharma Polimetal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Mediacom position performs unexpectedly, Dharma Polimetal 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 Dharma Polimetal will offset losses from the drop in Dharma Polimetal's long position.| Global Mediacom vs. Media Nusantara Citra | Global Mediacom vs. Mnc Investama Tbk | Global Mediacom vs. Akr Corporindo Tbk | Global Mediacom vs. Ciputra Development Tbk |
| Dharma Polimetal vs. Triputra Agro Persada | Dharma Polimetal vs. Autopedia Sukses Lestari | Dharma Polimetal vs. Cisarua Mountain Dairy | Dharma Polimetal vs. Surya Esa Perkasa |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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