Correlation Between Indointernet Tbk and Media Nusantara
Can any of the company-specific risk be diversified away by investing in both Indointernet Tbk and Media Nusantara 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 Indointernet Tbk and Media Nusantara into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Indointernet Tbk PT and Media Nusantara Citra, you can compare the effects of market volatilities on Indointernet Tbk and Media Nusantara 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 Indointernet Tbk with a short position of Media Nusantara. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indointernet Tbk and Media Nusantara.
Diversification Opportunities for Indointernet Tbk and Media Nusantara
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Indointernet and Media is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Indointernet Tbk PT and Media Nusantara Citra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Media Nusantara Citra and Indointernet Tbk 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 Indointernet Tbk PT are associated (or correlated) with Media Nusantara. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Media Nusantara Citra has no effect on the direction of Indointernet Tbk i.e., Indointernet Tbk and Media Nusantara go up and down completely randomly.
Pair Corralation between Indointernet Tbk and Media Nusantara
Assuming the 90 days trading horizon Indointernet Tbk PT is expected to generate 1.03 times more return on investment than Media Nusantara. However, Indointernet Tbk is 1.03 times more volatile than Media Nusantara Citra. It trades about -0.2 of its potential returns per unit of risk. Media Nusantara Citra is currently generating about -0.5 per unit of risk. If you would invest 386,000 in Indointernet Tbk PT on November 18, 2024 and sell it today you would lose (23,000) from holding Indointernet Tbk PT or give up 5.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Indointernet Tbk PT vs. Media Nusantara Citra
Performance |
| Timeline |
| Indointernet Tbk |
| Media Nusantara Citra |
Indointernet Tbk and Media Nusantara Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indointernet Tbk and Media Nusantara
The main advantage of trading using opposite Indointernet Tbk and Media Nusantara positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indointernet Tbk position performs unexpectedly, Media Nusantara 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 Media Nusantara will offset losses from the drop in Media Nusantara's long position.| Indointernet Tbk vs. DCI Indonesia Tbk | Indointernet Tbk vs. Digital Mediatama Maxima | Indointernet Tbk vs. Multipolar Technology Tbk | Indointernet Tbk vs. Bank Net Indonesia |
| Media Nusantara vs. Lenox Pasifik Investama | Media Nusantara vs. Multipolar Tbk | Media Nusantara vs. Lautan Luas Tbk | Media Nusantara vs. Metrodata Electronics 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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