Correlation Between Energi Mega and Fks Multi
Can any of the company-specific risk be diversified away by investing in both Energi Mega and Fks Multi 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 Energi Mega and Fks Multi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Energi Mega Persada and Fks Multi Agro, you can compare the effects of market volatilities on Energi Mega and Fks Multi 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 Energi Mega with a short position of Fks Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energi Mega and Fks Multi.
Diversification Opportunities for Energi Mega and Fks Multi
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Energi and Fks is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Energi Mega Persada and Fks Multi Agro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fks Multi Agro and Energi Mega 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 Energi Mega Persada are associated (or correlated) with Fks Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fks Multi Agro has no effect on the direction of Energi Mega i.e., Energi Mega and Fks Multi go up and down completely randomly.
Pair Corralation between Energi Mega and Fks Multi
Assuming the 90 days trading horizon Energi Mega Persada is expected to under-perform the Fks Multi. In addition to that, Energi Mega is 26.97 times more volatile than Fks Multi Agro. It trades about -0.15 of its total potential returns per unit of risk. Fks Multi Agro is currently generating about -0.52 per unit of volatility. If you would invest 1,100,000 in Fks Multi Agro on September 2, 2024 and sell it today you would lose (17,500) from holding Fks Multi Agro or give up 1.59% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Energi Mega Persada vs. Fks Multi Agro
Performance |
| Timeline |
| Energi Mega Persada |
| Fks Multi Agro |
Energi Mega and Fks Multi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energi Mega and Fks Multi
The main advantage of trading using opposite Energi Mega and Fks Multi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energi Mega position performs unexpectedly, Fks Multi 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 Fks Multi will offset losses from the drop in Fks Multi's long position.| Energi Mega vs. Mitrabahtera Segara Sejati | Energi Mega vs. Weha Transportasi Indonesia | Energi Mega vs. Rig Tenders Tbk | Energi Mega vs. Rukun Raharja Tbk |
| Fks Multi vs. Bank BRISyariah Tbk | Fks Multi vs. Mitra Pinasthika Mustika | Fks Multi vs. Jakarta Int Hotels | Fks Multi vs. Indosterling Technomedia 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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