Correlation Between Digital Mediatama and Multistrada Arah
Can any of the company-specific risk be diversified away by investing in both Digital Mediatama and Multistrada Arah 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 Multistrada Arah 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 Multistrada Arah Sarana, you can compare the effects of market volatilities on Digital Mediatama and Multistrada Arah 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 Multistrada Arah. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digital Mediatama and Multistrada Arah.
Diversification Opportunities for Digital Mediatama and Multistrada Arah
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Digital and Multistrada is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Digital Mediatama Maxima and Multistrada Arah Sarana in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multistrada Arah Sarana 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 Multistrada Arah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multistrada Arah Sarana has no effect on the direction of Digital Mediatama i.e., Digital Mediatama and Multistrada Arah go up and down completely randomly.
Pair Corralation between Digital Mediatama and Multistrada Arah
Assuming the 90 days trading horizon Digital Mediatama Maxima is expected to generate 2.22 times more return on investment than Multistrada Arah. However, Digital Mediatama is 2.22 times more volatile than Multistrada Arah Sarana. It trades about 0.13 of its potential returns per unit of risk. Multistrada Arah Sarana is currently generating about 0.11 per unit of risk. If you would invest 11,900 in Digital Mediatama Maxima on September 1, 2024 and sell it today you would earn a total of 10,100 from holding Digital Mediatama Maxima or generate 84.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Digital Mediatama Maxima vs. Multistrada Arah Sarana
Performance |
| Timeline |
| Digital Mediatama Maxima |
| Multistrada Arah Sarana |
Digital Mediatama and Multistrada Arah Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digital Mediatama and Multistrada Arah
The main advantage of trading using opposite Digital Mediatama and Multistrada Arah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digital Mediatama position performs unexpectedly, Multistrada Arah 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 Multistrada Arah will offset losses from the drop in Multistrada Arah'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 |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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