Correlation Between Elang Mahkota and Exploitasi Energi
Can any of the company-specific risk be diversified away by investing in both Elang Mahkota and Exploitasi Energi 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 Elang Mahkota and Exploitasi Energi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Elang Mahkota Teknologi and Exploitasi Energi Indonesia, you can compare the effects of market volatilities on Elang Mahkota and Exploitasi Energi 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 Elang Mahkota with a short position of Exploitasi Energi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elang Mahkota and Exploitasi Energi.
Diversification Opportunities for Elang Mahkota and Exploitasi Energi
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Elang and Exploitasi is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Elang Mahkota Teknologi and Exploitasi Energi Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exploitasi Energi and Elang Mahkota 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 Elang Mahkota Teknologi are associated (or correlated) with Exploitasi Energi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exploitasi Energi has no effect on the direction of Elang Mahkota i.e., Elang Mahkota and Exploitasi Energi go up and down completely randomly.
Pair Corralation between Elang Mahkota and Exploitasi Energi
Assuming the 90 days trading horizon Elang Mahkota is expected to generate 3.5 times less return on investment than Exploitasi Energi. But when comparing it to its historical volatility, Elang Mahkota Teknologi is 2.53 times less risky than Exploitasi Energi. It trades about 0.26 of its potential returns per unit of risk. Exploitasi Energi Indonesia is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 700.00 in Exploitasi Energi Indonesia on September 14, 2024 and sell it today you would earn a total of 600.00 from holding Exploitasi Energi Indonesia or generate 85.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Elang Mahkota Teknologi vs. Exploitasi Energi Indonesia
Performance |
| Timeline |
| Elang Mahkota Teknologi |
| Exploitasi Energi |
Elang Mahkota and Exploitasi Energi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Elang Mahkota and Exploitasi Energi
The main advantage of trading using opposite Elang Mahkota and Exploitasi Energi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Elang Mahkota position performs unexpectedly, Exploitasi Energi 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 Exploitasi Energi will offset losses from the drop in Exploitasi Energi's long position.| Elang Mahkota vs. Mnc Land Tbk | Elang Mahkota vs. MNC Vision Networks | Elang Mahkota vs. MD Pictures Tbk | Elang Mahkota vs. Link Net Tbk |
| Exploitasi Energi vs. Harum Energy Tbk | Exploitasi Energi vs. Delta Dunia Makmur | Exploitasi Energi vs. Adi Sarana Armada | Exploitasi Energi vs. Elang Mahkota Teknologi |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |