Correlation Between Fortune Mate and Capital Financial
Can any of the company-specific risk be diversified away by investing in both Fortune Mate and Capital Financial 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 Fortune Mate and Capital Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fortune Mate Indonesia and Capital Financial Indonesia, you can compare the effects of market volatilities on Fortune Mate and Capital Financial 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 Fortune Mate with a short position of Capital Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fortune Mate and Capital Financial.
Diversification Opportunities for Fortune Mate and Capital Financial
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Fortune and Capital is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Fortune Mate Indonesia and Capital Financial Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capital Financial and Fortune Mate 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 Fortune Mate Indonesia are associated (or correlated) with Capital Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capital Financial has no effect on the direction of Fortune Mate i.e., Fortune Mate and Capital Financial go up and down completely randomly.
Pair Corralation between Fortune Mate and Capital Financial
Assuming the 90 days trading horizon Fortune Mate Indonesia is expected to generate 5.21 times more return on investment than Capital Financial. However, Fortune Mate is 5.21 times more volatile than Capital Financial Indonesia. It trades about 0.43 of its potential returns per unit of risk. Capital Financial Indonesia is currently generating about -0.15 per unit of risk. If you would invest 23,800 in Fortune Mate Indonesia on August 31, 2024 and sell it today you would earn a total of 30,700 from holding Fortune Mate Indonesia or generate 128.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fortune Mate Indonesia vs. Capital Financial Indonesia
Performance |
| Timeline |
| Fortune Mate Indonesia |
| Capital Financial |
Fortune Mate and Capital Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fortune Mate and Capital Financial
The main advantage of trading using opposite Fortune Mate and Capital Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fortune Mate position performs unexpectedly, Capital Financial 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 Capital Financial will offset losses from the drop in Capital Financial's long position.| Fortune Mate vs. Lippo Cikarang Tbk | Fortune Mate vs. Bekasi Asri Pemula | Fortune Mate vs. Mitra Pinasthika Mustika | Fortune Mate vs. Jakarta Int Hotels |
| Capital Financial vs. Bank BRISyariah Tbk | Capital Financial vs. Ace Hardware Indonesia | Capital Financial vs. Merdeka Copper Gold | Capital Financial vs. Mitra Pinasthika Mustika |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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