Correlation Between Metro Healthcare and Bank Mnc

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Metro Healthcare and Bank 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 Metro Healthcare and Bank Mnc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Metro Healthcare Indonesia and Bank Mnc Internasional, you can compare the effects of market volatilities on Metro Healthcare and Bank 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 Metro Healthcare with a short position of Bank Mnc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metro Healthcare and Bank Mnc.

Diversification Opportunities for Metro Healthcare and Bank Mnc

-0.78
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Metro and Bank is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Metro Healthcare Indonesia and Bank Mnc Internasional in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Mnc Internasional and Metro Healthcare 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 Metro Healthcare Indonesia are associated (or correlated) with Bank Mnc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Mnc Internasional has no effect on the direction of Metro Healthcare i.e., Metro Healthcare and Bank Mnc go up and down completely randomly.

Pair Corralation between Metro Healthcare and Bank Mnc

Assuming the 90 days trading horizon Metro Healthcare Indonesia is expected to generate 0.97 times more return on investment than Bank Mnc. However, Metro Healthcare Indonesia is 1.03 times less risky than Bank Mnc. It trades about 0.41 of its potential returns per unit of risk. Bank Mnc Internasional is currently generating about -0.21 per unit of risk. If you would invest  13,000  in Metro Healthcare Indonesia on August 31, 2024 and sell it today you would earn a total of  4,100  from holding Metro Healthcare Indonesia or generate 31.54% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Metro Healthcare Indonesia  vs.  Bank Mnc Internasional

 Performance 
       Timeline  
Metro Healthcare Ind 

Risk-Adjusted Performance

27 of 100

 
Weak
 
Strong
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Metro Healthcare Indonesia are ranked lower than 27 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting forward-looking signals, Metro Healthcare disclosed solid returns over the last few months and may actually be approaching a breakup point.
Bank Mnc Internasional 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Bank Mnc Internasional has generated negative risk-adjusted returns adding no value to investors with long positions. Despite conflicting performance in the last few months, the Stock's forward-looking signals remain quite persistent which may send shares a bit higher in December 2024. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Metro Healthcare and Bank Mnc Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Metro Healthcare and Bank Mnc

The main advantage of trading using opposite Metro Healthcare and Bank Mnc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metro Healthcare position performs unexpectedly, Bank 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 Bank Mnc will offset losses from the drop in Bank Mnc's long position.
The idea behind Metro Healthcare Indonesia and Bank Mnc Internasional pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.

Other Complementary Tools

Bond Analysis
Evaluate and analyze corporate bonds as a potential investment for your portfolios.
Portfolio Anywhere
Track or share privately all of your investments from the convenience of any device
Financial Widgets
Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets
Portfolio Holdings
Check your current holdings and cash postion to detemine if your portfolio needs rebalancing
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like