Correlation Between Cahayaputra Asa and PT MNC
Can any of the company-specific risk be diversified away by investing in both Cahayaputra Asa and PT MNC 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 Cahayaputra Asa and PT MNC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cahayaputra Asa Keramik and PT MNC Energy, you can compare the effects of market volatilities on Cahayaputra Asa and PT MNC 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 Cahayaputra Asa with a short position of PT MNC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cahayaputra Asa and PT MNC.
Diversification Opportunities for Cahayaputra Asa and PT MNC
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cahayaputra and IATA is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Cahayaputra Asa Keramik and PT MNC Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT MNC Energy and Cahayaputra Asa 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 Cahayaputra Asa Keramik are associated (or correlated) with PT MNC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT MNC Energy has no effect on the direction of Cahayaputra Asa i.e., Cahayaputra Asa and PT MNC go up and down completely randomly.
Pair Corralation between Cahayaputra Asa and PT MNC
Assuming the 90 days trading horizon Cahayaputra Asa Keramik is expected to under-perform the PT MNC. But the stock apears to be less risky and, when comparing its historical volatility, Cahayaputra Asa Keramik is 1.06 times less risky than PT MNC. The stock trades about -0.04 of its potential returns per unit of risk. The PT MNC Energy is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 3,800 in PT MNC Energy on September 2, 2024 and sell it today you would earn a total of 600.00 from holding PT MNC Energy or generate 15.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cahayaputra Asa Keramik vs. PT MNC Energy
Performance |
| Timeline |
| Cahayaputra Asa Keramik |
| PT MNC Energy |
Cahayaputra Asa and PT MNC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cahayaputra Asa and PT MNC
The main advantage of trading using opposite Cahayaputra Asa and PT MNC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cahayaputra Asa position performs unexpectedly, PT MNC 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 PT MNC will offset losses from the drop in PT MNC's long position.| Cahayaputra Asa vs. PT Indonesia Kendaraan | Cahayaputra Asa vs. Wijaya Karya Bangunan | Cahayaputra Asa vs. J Resources Asia | Cahayaputra Asa vs. Steel Pipe Industry |
| PT MNC vs. Matahari Department Store | PT MNC vs. Multi Medika Internasional | PT MNC vs. Visi Media Asia | PT MNC vs. Bayan Resources 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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