Correlation Between Smartfren Telecom and Mnc Land
Can any of the company-specific risk be diversified away by investing in both Smartfren Telecom and Mnc Land 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 Smartfren Telecom and Mnc Land into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smartfren Telecom Tbk and Mnc Land Tbk, you can compare the effects of market volatilities on Smartfren Telecom and Mnc Land 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 Smartfren Telecom with a short position of Mnc Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smartfren Telecom and Mnc Land.
Diversification Opportunities for Smartfren Telecom and Mnc Land
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Smartfren and Mnc is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Smartfren Telecom Tbk and Mnc Land Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mnc Land Tbk and Smartfren Telecom 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 Smartfren Telecom Tbk are associated (or correlated) with Mnc Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mnc Land Tbk has no effect on the direction of Smartfren Telecom i.e., Smartfren Telecom and Mnc Land go up and down completely randomly.
Pair Corralation between Smartfren Telecom and Mnc Land
Assuming the 90 days trading horizon Smartfren Telecom Tbk is expected to under-perform the Mnc Land. But the stock apears to be less risky and, when comparing its historical volatility, Smartfren Telecom Tbk is 1.3 times less risky than Mnc Land. The stock trades about -0.08 of its potential returns per unit of risk. The Mnc Land Tbk is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 7,400 in Mnc Land Tbk on August 24, 2024 and sell it today you would earn a total of 8,000 from holding Mnc Land Tbk or generate 108.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Smartfren Telecom Tbk vs. Mnc Land Tbk
Performance |
| Timeline |
| Smartfren Telecom Tbk |
| Mnc Land Tbk |
Smartfren Telecom and Mnc Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smartfren Telecom and Mnc Land
The main advantage of trading using opposite Smartfren Telecom and Mnc Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smartfren Telecom position performs unexpectedly, Mnc Land 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 Mnc Land will offset losses from the drop in Mnc Land's long position.| Smartfren Telecom vs. Mnc Land Tbk | Smartfren Telecom vs. MNC Vision Networks | Smartfren Telecom vs. MD Pictures Tbk | Smartfren Telecom vs. Link Net Tbk |
| Mnc Land vs. Agung Podomoro Land | Mnc Land vs. Surya Semesta Internusa | Mnc Land vs. Alam Sutera Realty | Mnc Land vs. Bumi Serpong Damai |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |