Correlation Between Nusa Konstruksi and Matahari Department
Can any of the company-specific risk be diversified away by investing in both Nusa Konstruksi and Matahari Department 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 Nusa Konstruksi and Matahari Department into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nusa Konstruksi Enjiniring and Matahari Department Store, you can compare the effects of market volatilities on Nusa Konstruksi and Matahari Department 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 Nusa Konstruksi with a short position of Matahari Department. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nusa Konstruksi and Matahari Department.
Diversification Opportunities for Nusa Konstruksi and Matahari Department
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nusa and Matahari is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Nusa Konstruksi Enjiniring and Matahari Department Store in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matahari Department Store and Nusa Konstruksi 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 Nusa Konstruksi Enjiniring are associated (or correlated) with Matahari Department. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matahari Department Store has no effect on the direction of Nusa Konstruksi i.e., Nusa Konstruksi and Matahari Department go up and down completely randomly.
Pair Corralation between Nusa Konstruksi and Matahari Department
Assuming the 90 days trading horizon Nusa Konstruksi Enjiniring is expected to under-perform the Matahari Department. But the stock apears to be less risky and, when comparing its historical volatility, Nusa Konstruksi Enjiniring is 1.37 times less risky than Matahari Department. The stock trades about -0.07 of its potential returns per unit of risk. The Matahari Department Store is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 152,000 in Matahari Department Store on September 3, 2024 and sell it today you would lose (11,000) from holding Matahari Department Store or give up 7.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nusa Konstruksi Enjiniring vs. Matahari Department Store
Performance |
| Timeline |
| Nusa Konstruksi Enji |
| Matahari Department Store |
Nusa Konstruksi and Matahari Department Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nusa Konstruksi and Matahari Department
The main advantage of trading using opposite Nusa Konstruksi and Matahari Department positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nusa Konstruksi position performs unexpectedly, Matahari Department 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 Matahari Department will offset losses from the drop in Matahari Department's long position.| Nusa Konstruksi vs. Sentul City Tbk | Nusa Konstruksi vs. Gozco Plantations Tbk | Nusa Konstruksi vs. Bukit Darmo Property | Nusa Konstruksi vs. Total Bangun Persada |
| Matahari Department vs. Surya Citra Media | Matahari Department vs. Akr Corporindo Tbk | Matahari Department vs. Media Nusantara Citra | Matahari Department vs. Pembangunan Perumahan 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| 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 | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |