Correlation Between Medikaloka Hermina and Integra Indocabinet
Can any of the company-specific risk be diversified away by investing in both Medikaloka Hermina and Integra Indocabinet 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 Medikaloka Hermina and Integra Indocabinet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Medikaloka Hermina PT and Integra Indocabinet Tbk, you can compare the effects of market volatilities on Medikaloka Hermina and Integra Indocabinet 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 Medikaloka Hermina with a short position of Integra Indocabinet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medikaloka Hermina and Integra Indocabinet.
Diversification Opportunities for Medikaloka Hermina and Integra Indocabinet
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Medikaloka and Integra is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Medikaloka Hermina PT and Integra Indocabinet Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Integra Indocabinet Tbk and Medikaloka Hermina 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 Medikaloka Hermina PT are associated (or correlated) with Integra Indocabinet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Integra Indocabinet Tbk has no effect on the direction of Medikaloka Hermina i.e., Medikaloka Hermina and Integra Indocabinet go up and down completely randomly.
Pair Corralation between Medikaloka Hermina and Integra Indocabinet
Assuming the 90 days trading horizon Medikaloka Hermina PT is expected to under-perform the Integra Indocabinet. But the stock apears to be less risky and, when comparing its historical volatility, Medikaloka Hermina PT is 2.72 times less risky than Integra Indocabinet. The stock trades about -0.1 of its potential returns per unit of risk. The Integra Indocabinet Tbk is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 30,800 in Integra Indocabinet Tbk on August 29, 2024 and sell it today you would earn a total of 3,000 from holding Integra Indocabinet Tbk or generate 9.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Medikaloka Hermina PT vs. Integra Indocabinet Tbk
Performance |
| Timeline |
| Medikaloka Hermina |
| Integra Indocabinet Tbk |
Medikaloka Hermina and Integra Indocabinet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Medikaloka Hermina and Integra Indocabinet
The main advantage of trading using opposite Medikaloka Hermina and Integra Indocabinet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Medikaloka Hermina position performs unexpectedly, Integra Indocabinet 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 Integra Indocabinet will offset losses from the drop in Integra Indocabinet's long position.| Medikaloka Hermina vs. Merdeka Copper Gold | Medikaloka Hermina vs. Tower Bersama Infrastructure | Medikaloka Hermina vs. Erajaya Swasembada Tbk | Medikaloka Hermina vs. Surya Citra Media |
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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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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