Correlation Between Sentra Food and Mitrabahtera Segara
Can any of the company-specific risk be diversified away by investing in both Sentra Food and Mitrabahtera Segara 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 Sentra Food and Mitrabahtera Segara into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sentra Food Indonesia and Mitrabahtera Segara Sejati, you can compare the effects of market volatilities on Sentra Food and Mitrabahtera Segara 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 Sentra Food with a short position of Mitrabahtera Segara. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sentra Food and Mitrabahtera Segara.
Diversification Opportunities for Sentra Food and Mitrabahtera Segara
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sentra and Mitrabahtera is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Sentra Food Indonesia and Mitrabahtera Segara Sejati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitrabahtera Segara and Sentra Food 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 Sentra Food Indonesia are associated (or correlated) with Mitrabahtera Segara. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitrabahtera Segara has no effect on the direction of Sentra Food i.e., Sentra Food and Mitrabahtera Segara go up and down completely randomly.
Pair Corralation between Sentra Food and Mitrabahtera Segara
Assuming the 90 days trading horizon Sentra Food Indonesia is expected to generate 0.51 times more return on investment than Mitrabahtera Segara. However, Sentra Food Indonesia is 1.98 times less risky than Mitrabahtera Segara. It trades about 0.0 of its potential returns per unit of risk. Mitrabahtera Segara Sejati is currently generating about -0.01 per unit of risk. If you would invest 11,600 in Sentra Food Indonesia on September 19, 2024 and sell it today you would earn a total of 0.00 from holding Sentra Food Indonesia or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sentra Food Indonesia vs. Mitrabahtera Segara Sejati
Performance |
| Timeline |
| Sentra Food Indonesia |
| Mitrabahtera Segara |
Sentra Food and Mitrabahtera Segara Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sentra Food and Mitrabahtera Segara
The main advantage of trading using opposite Sentra Food and Mitrabahtera Segara positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sentra Food position performs unexpectedly, Mitrabahtera Segara 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 Mitrabahtera Segara will offset losses from the drop in Mitrabahtera Segara's long position.| Sentra Food vs. Garudafood Putra Putri | Sentra Food vs. Wijaya Karya Bangunan | Sentra Food vs. Mitrabara Adiperdana PT | Sentra Food vs. PT Multi Garam |
| Mitrabahtera Segara vs. Petrosea Tbk | Mitrabahtera Segara vs. Samudera Indonesia Tbk | Mitrabahtera Segara vs. Soechi Lines Tbk | Mitrabahtera Segara vs. Wintermar Offshore Marine |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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