Correlation Between MD Pictures and Link Net
Can any of the company-specific risk be diversified away by investing in both MD Pictures and Link Net 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 Link Net 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 Link Net Tbk, you can compare the effects of market volatilities on MD Pictures and Link Net 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 Link Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of MD Pictures and Link Net.
Diversification Opportunities for MD Pictures and Link Net
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FILM and Link is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding MD Pictures Tbk and Link Net Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Link Net 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 Link Net. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Link Net Tbk has no effect on the direction of MD Pictures i.e., MD Pictures and Link Net go up and down completely randomly.
Pair Corralation between MD Pictures and Link Net
Assuming the 90 days trading horizon MD Pictures Tbk is expected to generate 0.82 times more return on investment than Link Net. However, MD Pictures Tbk is 1.22 times less risky than Link Net. It trades about 0.01 of its potential returns per unit of risk. Link Net Tbk is currently generating about -0.01 per unit of risk. If you would invest 378,677 in MD Pictures Tbk on August 24, 2024 and sell it today you would lose (22,677) from holding MD Pictures Tbk or give up 5.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MD Pictures Tbk vs. Link Net Tbk
Performance |
| Timeline |
| MD Pictures Tbk |
| Link Net Tbk |
MD Pictures and Link Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MD Pictures and Link Net
The main advantage of trading using opposite MD Pictures and Link Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MD Pictures position performs unexpectedly, Link Net 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 Link Net will offset losses from the drop in Link Net's long position.| MD Pictures vs. MNC Studios International | MD Pictures vs. Elang Mahkota Teknologi | MD Pictures vs. Medikaloka Hermina PT | MD Pictures vs. Surya Esa Perkasa |
| Link Net vs. Mnc Land Tbk | Link Net vs. MNC Vision Networks | Link Net vs. MD Pictures Tbk | Link Net vs. Medikaloka Hermina PT |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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