Correlation Between Centratama Telekomunikasi and Mnc Land
Can any of the company-specific risk be diversified away by investing in both Centratama Telekomunikasi and Mnc Land 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 Centratama Telekomunikasi and Mnc Land into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Centratama Telekomunikasi Ind and Mnc Land Tbk, you can compare the effects of market volatilities on Centratama Telekomunikasi and Mnc Land 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 Centratama Telekomunikasi with a short position of Mnc Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Centratama Telekomunikasi and Mnc Land.
Diversification Opportunities for Centratama Telekomunikasi and Mnc Land
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Centratama and Mnc is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Centratama Telekomunikasi Ind and Mnc Land Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mnc Land Tbk and Centratama Telekomunikasi 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 Centratama Telekomunikasi Ind are associated (or correlated) with Mnc Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mnc Land Tbk has no effect on the direction of Centratama Telekomunikasi i.e., Centratama Telekomunikasi and Mnc Land go up and down completely randomly.
Pair Corralation between Centratama Telekomunikasi and Mnc Land
Assuming the 90 days trading horizon Centratama Telekomunikasi Ind is expected to under-perform the Mnc Land. In addition to that, Centratama Telekomunikasi is 1.77 times more volatile than Mnc Land Tbk. It trades about -0.11 of its total potential returns per unit of risk. Mnc Land Tbk is currently generating about -0.13 per unit of volatility. If you would invest 16,300 in Mnc Land Tbk on September 13, 2024 and sell it today you would lose (1,000.00) from holding Mnc Land Tbk or give up 6.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Centratama Telekomunikasi Ind vs. Mnc Land Tbk
Performance |
| Timeline |
| Centratama Telekomunikasi |
| Mnc Land Tbk |
Centratama Telekomunikasi and Mnc Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Centratama Telekomunikasi and Mnc Land
The main advantage of trading using opposite Centratama Telekomunikasi and Mnc Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Centratama Telekomunikasi position performs unexpectedly, Mnc Land 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 Mnc Land will offset losses from the drop in Mnc Land's long position.| Centratama Telekomunikasi vs. Mnc Land Tbk | Centratama Telekomunikasi vs. MNC Vision Networks | Centratama Telekomunikasi vs. MD Pictures Tbk | Centratama Telekomunikasi vs. Link Net Tbk |
| Mnc Land vs. Modernland Realty Ltd | Mnc Land vs. Jaya Real Property | Mnc Land vs. Lippo Cikarang Tbk | Mnc Land vs. Jakarta Int Hotels |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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