Correlation Between Bumi Resources and Map Boga
Can any of the company-specific risk be diversified away by investing in both Bumi Resources and Map Boga 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 Bumi Resources and Map Boga into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bumi Resources Minerals and Map Boga Adiperkasa, you can compare the effects of market volatilities on Bumi Resources and Map Boga 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 Bumi Resources with a short position of Map Boga. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bumi Resources and Map Boga.
Diversification Opportunities for Bumi Resources and Map Boga
-0.92 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Bumi and Map is -0.92. Overlapping area represents the amount of risk that can be diversified away by holding Bumi Resources Minerals and Map Boga Adiperkasa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Map Boga Adiperkasa and Bumi Resources 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 Bumi Resources Minerals are associated (or correlated) with Map Boga. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Map Boga Adiperkasa has no effect on the direction of Bumi Resources i.e., Bumi Resources and Map Boga go up and down completely randomly.
Pair Corralation between Bumi Resources and Map Boga
Assuming the 90 days trading horizon Bumi Resources Minerals is expected to generate 1.39 times more return on investment than Map Boga. However, Bumi Resources is 1.39 times more volatile than Map Boga Adiperkasa. It trades about 0.07 of its potential returns per unit of risk. Map Boga Adiperkasa is currently generating about -0.01 per unit of risk. If you would invest 17,800 in Bumi Resources Minerals on August 25, 2024 and sell it today you would earn a total of 26,400 from holding Bumi Resources Minerals or generate 148.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Bumi Resources Minerals vs. Map Boga Adiperkasa
Performance |
| Timeline |
| Bumi Resources Minerals |
| Map Boga Adiperkasa |
Bumi Resources and Map Boga Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bumi Resources and Map Boga
The main advantage of trading using opposite Bumi Resources and Map Boga positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bumi Resources position performs unexpectedly, Map Boga 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 Map Boga will offset losses from the drop in Map Boga's long position.| Bumi Resources vs. Energi Mega Persada | Bumi Resources vs. Harum Energy Tbk | Bumi Resources vs. Delta Dunia Makmur | Bumi Resources vs. Benakat Petroleum Energy |
| Map Boga vs. MAP Aktif Adiperkasa | Map Boga vs. Fast Food Indonesia | Map Boga vs. PT Sarimelati Kencana | Map Boga vs. Prodia Widyahusada 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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