Correlation Between Sariguna Primatirta and Mulia Boga
Can any of the company-specific risk be diversified away by investing in both Sariguna Primatirta and Mulia Boga 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 Sariguna Primatirta and Mulia Boga into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sariguna Primatirta PT and Mulia Boga Raya, you can compare the effects of market volatilities on Sariguna Primatirta and Mulia Boga 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 Sariguna Primatirta with a short position of Mulia Boga. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sariguna Primatirta and Mulia Boga.
Diversification Opportunities for Sariguna Primatirta and Mulia Boga
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sariguna and Mulia is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Sariguna Primatirta PT and Mulia Boga Raya in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mulia Boga Raya and Sariguna Primatirta 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 Sariguna Primatirta PT are associated (or correlated) with Mulia Boga. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mulia Boga Raya has no effect on the direction of Sariguna Primatirta i.e., Sariguna Primatirta and Mulia Boga go up and down completely randomly.
Pair Corralation between Sariguna Primatirta and Mulia Boga
Assuming the 90 days trading horizon Sariguna Primatirta is expected to generate 6.71 times less return on investment than Mulia Boga. But when comparing it to its historical volatility, Sariguna Primatirta PT is 3.06 times less risky than Mulia Boga. It trades about 0.03 of its potential returns per unit of risk. Mulia Boga Raya is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 148,500 in Mulia Boga Raya on August 30, 2024 and sell it today you would earn a total of 23,500 from holding Mulia Boga Raya or generate 15.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sariguna Primatirta PT vs. Mulia Boga Raya
Performance |
| Timeline |
| Sariguna Primatirta |
| Mulia Boga Raya |
Sariguna Primatirta and Mulia Boga Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sariguna Primatirta and Mulia Boga
The main advantage of trading using opposite Sariguna Primatirta and Mulia Boga positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sariguna Primatirta position performs unexpectedly, Mulia Boga 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 Mulia Boga will offset losses from the drop in Mulia Boga's long position.| Sariguna Primatirta vs. Buyung Poetra Sembada | Sariguna Primatirta vs. Sido Muncul PT | Sariguna Primatirta vs. Mayora Indah Tbk | Sariguna Primatirta vs. Bank Tabungan Pensiunan |
| Mulia Boga vs. Garudafood Putra Putri | Mulia Boga vs. Uni Charm Indonesia | Mulia Boga vs. Campina Ice Cream | Mulia Boga vs. Mitrabara Adiperdana PT |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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