Correlation Between Digital Mediatama and Indointernet Tbk
Can any of the company-specific risk be diversified away by investing in both Digital Mediatama and Indointernet Tbk 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 Digital Mediatama and Indointernet Tbk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Digital Mediatama Maxima and Indointernet Tbk PT, you can compare the effects of market volatilities on Digital Mediatama and Indointernet Tbk 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 Digital Mediatama with a short position of Indointernet Tbk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digital Mediatama and Indointernet Tbk.
Diversification Opportunities for Digital Mediatama and Indointernet Tbk
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Digital and Indointernet is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Digital Mediatama Maxima and Indointernet Tbk PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indointernet Tbk and Digital Mediatama 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 Digital Mediatama Maxima are associated (or correlated) with Indointernet Tbk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indointernet Tbk has no effect on the direction of Digital Mediatama i.e., Digital Mediatama and Indointernet Tbk go up and down completely randomly.
Pair Corralation between Digital Mediatama and Indointernet Tbk
Assuming the 90 days trading horizon Digital Mediatama Maxima is expected to generate 3.93 times more return on investment than Indointernet Tbk. However, Digital Mediatama is 3.93 times more volatile than Indointernet Tbk PT. It trades about 0.14 of its potential returns per unit of risk. Indointernet Tbk PT is currently generating about -0.27 per unit of risk. If you would invest 19,600 in Digital Mediatama Maxima on August 24, 2024 and sell it today you would earn a total of 3,600 from holding Digital Mediatama Maxima or generate 18.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Digital Mediatama Maxima vs. Indointernet Tbk PT
Performance |
| Timeline |
| Digital Mediatama Maxima |
| Indointernet Tbk |
Digital Mediatama and Indointernet Tbk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digital Mediatama and Indointernet Tbk
The main advantage of trading using opposite Digital Mediatama and Indointernet Tbk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digital Mediatama position performs unexpectedly, Indointernet Tbk 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 Indointernet Tbk will offset losses from the drop in Indointernet Tbk's long position.| Digital Mediatama vs. Elang Mahkota Teknologi | Digital Mediatama vs. M Cash Integrasi | Digital Mediatama vs. Bank Artos Indonesia | Digital Mediatama vs. Bank Yudha Bhakti |
| Indointernet Tbk vs. DCI Indonesia Tbk | Indointernet Tbk vs. Digital Mediatama Maxima | Indointernet Tbk vs. Multipolar Technology Tbk | Indointernet Tbk vs. Bank Net Indonesia |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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