Correlation Between Digital Mediatama and Prodia Widyahusada
Can any of the company-specific risk be diversified away by investing in both Digital Mediatama and Prodia Widyahusada 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 Prodia Widyahusada 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 Prodia Widyahusada Tbk, you can compare the effects of market volatilities on Digital Mediatama and Prodia Widyahusada 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 Prodia Widyahusada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digital Mediatama and Prodia Widyahusada.
Diversification Opportunities for Digital Mediatama and Prodia Widyahusada
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Digital and Prodia is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Digital Mediatama Maxima and Prodia Widyahusada Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prodia Widyahusada 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 Prodia Widyahusada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prodia Widyahusada Tbk has no effect on the direction of Digital Mediatama i.e., Digital Mediatama and Prodia Widyahusada go up and down completely randomly.
Pair Corralation between Digital Mediatama and Prodia Widyahusada
Assuming the 90 days trading horizon Digital Mediatama Maxima is expected to generate 2.08 times more return on investment than Prodia Widyahusada. However, Digital Mediatama is 2.08 times more volatile than Prodia Widyahusada Tbk. It trades about 0.13 of its potential returns per unit of risk. Prodia Widyahusada Tbk is currently generating about -0.04 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 | Moves Against |
| Strength | Significant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Digital Mediatama Maxima vs. Prodia Widyahusada Tbk
Performance |
| Timeline |
| Digital Mediatama Maxima |
| Prodia Widyahusada Tbk |
Digital Mediatama and Prodia Widyahusada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digital Mediatama and Prodia Widyahusada
The main advantage of trading using opposite Digital Mediatama and Prodia Widyahusada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digital Mediatama position performs unexpectedly, Prodia Widyahusada 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 Prodia Widyahusada will offset losses from the drop in Prodia Widyahusada'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 |
| Prodia Widyahusada vs. Medikaloka Hermina PT | Prodia Widyahusada vs. Mitra Keluarga Karyasehat | Prodia Widyahusada vs. Siloam International Hospitals | Prodia Widyahusada vs. Saratoga Investama Sedaya |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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