Correlation Between Cita Mineral and Ifishdeco
Can any of the company-specific risk be diversified away by investing in both Cita Mineral and Ifishdeco 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 Cita Mineral and Ifishdeco into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cita Mineral Investindo and Ifishdeco PT, you can compare the effects of market volatilities on Cita Mineral and Ifishdeco 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 Cita Mineral with a short position of Ifishdeco. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cita Mineral and Ifishdeco.
Diversification Opportunities for Cita Mineral and Ifishdeco
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cita and Ifishdeco is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Cita Mineral Investindo and Ifishdeco PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ifishdeco PT and Cita Mineral 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 Cita Mineral Investindo are associated (or correlated) with Ifishdeco. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ifishdeco PT has no effect on the direction of Cita Mineral i.e., Cita Mineral and Ifishdeco go up and down completely randomly.
Pair Corralation between Cita Mineral and Ifishdeco
Assuming the 90 days trading horizon Cita Mineral Investindo is expected to generate 0.9 times more return on investment than Ifishdeco. However, Cita Mineral Investindo is 1.11 times less risky than Ifishdeco. It trades about 0.15 of its potential returns per unit of risk. Ifishdeco PT is currently generating about 0.0 per unit of risk. If you would invest 218,451 in Cita Mineral Investindo on August 29, 2024 and sell it today you would earn a total of 144,549 from holding Cita Mineral Investindo or generate 66.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cita Mineral Investindo vs. Ifishdeco PT
Performance |
| Timeline |
| Cita Mineral Investindo |
| Ifishdeco PT |
Cita Mineral and Ifishdeco Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cita Mineral and Ifishdeco
The main advantage of trading using opposite Cita Mineral and Ifishdeco positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cita Mineral position performs unexpectedly, Ifishdeco 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 Ifishdeco will offset losses from the drop in Ifishdeco's long position.| Cita Mineral vs. Barito Pacific Tbk | Cita Mineral vs. Charoen Pokphand Indonesia | Cita Mineral vs. Indocement Tunggal Prakarsa |
| Ifishdeco vs. Gunung Raja Paksi | Ifishdeco vs. Cita Mineral Investindo | Ifishdeco vs. Central Omega Resources | Ifishdeco vs. Indonesia Fibreboard Industry |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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