Correlation Between MD Pictures and PT Mulia
Can any of the company-specific risk be diversified away by investing in both MD Pictures and PT Mulia 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 PT Mulia 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 PT Mulia Industrindo, you can compare the effects of market volatilities on MD Pictures and PT Mulia 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 PT Mulia. Check out your portfolio center. Please also check ongoing floating volatility patterns of MD Pictures and PT Mulia.
Diversification Opportunities for MD Pictures and PT Mulia
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between FILM and MLIA is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding MD Pictures Tbk and PT Mulia Industrindo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Mulia Industrindo 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 PT Mulia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Mulia Industrindo has no effect on the direction of MD Pictures i.e., MD Pictures and PT Mulia go up and down completely randomly.
Pair Corralation between MD Pictures and PT Mulia
Assuming the 90 days trading horizon MD Pictures Tbk is expected to under-perform the PT Mulia. In addition to that, MD Pictures is 3.79 times more volatile than PT Mulia Industrindo. It trades about -0.13 of its total potential returns per unit of risk. PT Mulia Industrindo is currently generating about -0.23 per unit of volatility. If you would invest 36,000 in PT Mulia Industrindo on September 2, 2024 and sell it today you would lose (4,800) from holding PT Mulia Industrindo or give up 13.33% 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. PT Mulia Industrindo
Performance |
| Timeline |
| MD Pictures Tbk |
| PT Mulia Industrindo |
MD Pictures and PT Mulia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MD Pictures and PT Mulia
The main advantage of trading using opposite MD Pictures and PT Mulia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MD Pictures position performs unexpectedly, PT Mulia 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 PT Mulia will offset losses from the drop in PT Mulia'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 |
| PT Mulia vs. Suparma Tbk | PT Mulia vs. Pelangi Indah Canindo | PT Mulia vs. Surya Toto Indonesia | PT Mulia vs. Lautan Luas 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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