Correlation Between Delta Dunia and Energi Mega
Can any of the company-specific risk be diversified away by investing in both Delta Dunia and Energi Mega 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 Delta Dunia and Energi Mega into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Delta Dunia Makmur and Energi Mega Persada, you can compare the effects of market volatilities on Delta Dunia and Energi Mega 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 Delta Dunia with a short position of Energi Mega. Check out your portfolio center. Please also check ongoing floating volatility patterns of Delta Dunia and Energi Mega.
Diversification Opportunities for Delta Dunia and Energi Mega
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Delta and Energi is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Delta Dunia Makmur and Energi Mega Persada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energi Mega Persada and Delta Dunia 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 Delta Dunia Makmur are associated (or correlated) with Energi Mega. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energi Mega Persada has no effect on the direction of Delta Dunia i.e., Delta Dunia and Energi Mega go up and down completely randomly.
Pair Corralation between Delta Dunia and Energi Mega
Assuming the 90 days trading horizon Delta Dunia Makmur is expected to generate 0.89 times more return on investment than Energi Mega. However, Delta Dunia Makmur is 1.12 times less risky than Energi Mega. It trades about 0.11 of its potential returns per unit of risk. Energi Mega Persada is currently generating about 0.03 per unit of risk. If you would invest 34,278 in Delta Dunia Makmur on August 24, 2024 and sell it today you would earn a total of 30,722 from holding Delta Dunia Makmur or generate 89.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Delta Dunia Makmur vs. Energi Mega Persada
Performance |
| Timeline |
| Delta Dunia Makmur |
| Energi Mega Persada |
Delta Dunia and Energi Mega Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Delta Dunia and Energi Mega
The main advantage of trading using opposite Delta Dunia and Energi Mega positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Delta Dunia position performs unexpectedly, Energi Mega 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 Energi Mega will offset losses from the drop in Energi Mega's long position.| Delta Dunia vs. Bakrieland Development Tbk | Delta Dunia vs. Bakrie Sumatera Plantations | Delta Dunia vs. Bakrie Brothers Tbk | Delta Dunia vs. Darma Henwa Tbk |
| Energi Mega vs. Bakrieland Development Tbk | Energi Mega vs. Bakrie Sumatera Plantations | Energi Mega vs. Bakrie Brothers Tbk | Energi Mega vs. Darma Henwa Tbk |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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