Correlation Between Metro Healthcare and Wahana Ottomitra
Can any of the company-specific risk be diversified away by investing in both Metro Healthcare and Wahana Ottomitra 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 Wahana Ottomitra 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 Wahana Ottomitra Multiartha, you can compare the effects of market volatilities on Metro Healthcare and Wahana Ottomitra 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 Wahana Ottomitra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metro Healthcare and Wahana Ottomitra.
Diversification Opportunities for Metro Healthcare and Wahana Ottomitra
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Metro and Wahana is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Metro Healthcare Indonesia and Wahana Ottomitra Multiartha in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wahana Ottomitra Mul 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 Wahana Ottomitra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wahana Ottomitra Mul has no effect on the direction of Metro Healthcare i.e., Metro Healthcare and Wahana Ottomitra go up and down completely randomly.
Pair Corralation between Metro Healthcare and Wahana Ottomitra
Assuming the 90 days trading horizon Metro Healthcare Indonesia is expected to under-perform the Wahana Ottomitra. In addition to that, Metro Healthcare is 2.98 times more volatile than Wahana Ottomitra Multiartha. It trades about -0.04 of its total potential returns per unit of risk. Wahana Ottomitra Multiartha is currently generating about 0.01 per unit of volatility. If you would invest 35,913 in Wahana Ottomitra Multiartha on August 28, 2024 and sell it today you would earn a total of 287.00 from holding Wahana Ottomitra Multiartha or generate 0.8% 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. Wahana Ottomitra Multiartha
Performance |
| Timeline |
| Metro Healthcare Ind |
| Wahana Ottomitra Mul |
Metro Healthcare and Wahana Ottomitra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metro Healthcare and Wahana Ottomitra
The main advantage of trading using opposite Metro Healthcare and Wahana Ottomitra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metro Healthcare position performs unexpectedly, Wahana Ottomitra 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 Wahana Ottomitra will offset losses from the drop in Wahana Ottomitra's long position.| Metro Healthcare vs. Medikaloka Hermina PT | Metro Healthcare vs. Mitra Keluarga Karyasehat | Metro Healthcare vs. Bhakti Multi Artha | Metro Healthcare vs. Surya Permata Andalan |
| Wahana Ottomitra vs. Trimegah Securities Tbk | Wahana Ottomitra vs. Clipan Finance Indonesia | Wahana Ottomitra vs. Adira Dinamika Multi | Wahana Ottomitra vs. Paninvest 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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