Correlation Between MD Pictures and First Media
Can any of the company-specific risk be diversified away by investing in both MD Pictures and First Media 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 MD Pictures and First Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MD Pictures Tbk and First Media Tbk, you can compare the effects of market volatilities on MD Pictures and First Media 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 MD Pictures with a short position of First Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of MD Pictures and First Media.
Diversification Opportunities for MD Pictures and First Media
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between FILM and First is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding MD Pictures Tbk and First Media Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Media Tbk and MD Pictures 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 MD Pictures Tbk are associated (or correlated) with First Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Media Tbk has no effect on the direction of MD Pictures i.e., MD Pictures and First Media go up and down completely randomly.
Pair Corralation between MD Pictures and First Media
Assuming the 90 days trading horizon MD Pictures Tbk is expected to generate 1.53 times more return on investment than First Media. However, MD Pictures is 1.53 times more volatile than First Media Tbk. It trades about 0.05 of its potential returns per unit of risk. First Media Tbk is currently generating about 0.01 per unit of risk. If you would invest 207,726 in MD Pictures Tbk on September 12, 2024 and sell it today you would earn a total of 165,274 from holding MD Pictures Tbk or generate 79.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
MD Pictures Tbk vs. First Media Tbk
Performance |
| Timeline |
| MD Pictures Tbk |
| First Media Tbk |
MD Pictures and First Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MD Pictures and First Media
The main advantage of trading using opposite MD Pictures and First Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MD Pictures position performs unexpectedly, First Media 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 First Media will offset losses from the drop in First Media's long position.| MD Pictures vs. Mnc Land Tbk | MD Pictures vs. MNC Vision Networks | MD Pictures vs. Link Net Tbk | MD Pictures vs. Medikaloka Hermina PT |
| First Media vs. Mnc Land Tbk | First Media vs. MNC Vision Networks | First Media vs. MD Pictures Tbk | First Media vs. Link Net 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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