Correlation Between Metro Healthcare and Bank Central
Can any of the company-specific risk be diversified away by investing in both Metro Healthcare and Bank Central 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 Central 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 Central Asia, you can compare the effects of market volatilities on Metro Healthcare and Bank Central 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 Central. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metro Healthcare and Bank Central.
Diversification Opportunities for Metro Healthcare and Bank Central
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Metro and Bank is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Metro Healthcare Indonesia and Bank Central Asia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Central Asia 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 Central. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Central Asia has no effect on the direction of Metro Healthcare i.e., Metro Healthcare and Bank Central go up and down completely randomly.
Pair Corralation between Metro Healthcare and Bank Central
Assuming the 90 days trading horizon Metro Healthcare Indonesia is expected to generate 2.36 times more return on investment than Bank Central. However, Metro Healthcare is 2.36 times more volatile than Bank Central Asia. It trades about 0.39 of its potential returns per unit of risk. Bank Central Asia is currently generating about -0.1 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 3,800 from holding Metro Healthcare Indonesia or generate 29.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metro Healthcare Indonesia vs. Bank Central Asia
Performance |
| Timeline |
| Metro Healthcare Ind |
| Bank Central Asia |
Metro Healthcare and Bank Central Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metro Healthcare and Bank Central
The main advantage of trading using opposite Metro Healthcare and Bank Central positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metro Healthcare position performs unexpectedly, Bank Central 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 Central will offset losses from the drop in Bank Central's long position.| Metro Healthcare vs. Medikaloka Hermina PT | Metro Healthcare vs. Sarana Meditama Metropolitan | Metro Healthcare vs. Mitra Keluarga Karyasehat | Metro Healthcare vs. Bhakti Multi Artha |
| Bank Central vs. Bank Rakyat Indonesia | Bank Central vs. Bank Mandiri Persero | Bank Central vs. Bank Negara Indonesia | Bank Central vs. Astra International 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |