Correlation Between PT MNC and Pt Pakuan
Can any of the company-specific risk be diversified away by investing in both PT MNC and Pt Pakuan 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 PT MNC and Pt Pakuan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT MNC Energy and Pt Pakuan Tbk, you can compare the effects of market volatilities on PT MNC and Pt Pakuan 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 PT MNC with a short position of Pt Pakuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT MNC and Pt Pakuan.
Diversification Opportunities for PT MNC and Pt Pakuan
Very good diversification
The 3 months correlation between IATA and UANG is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding PT MNC Energy and Pt Pakuan Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pt Pakuan Tbk and PT MNC 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 PT MNC Energy are associated (or correlated) with Pt Pakuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pt Pakuan Tbk has no effect on the direction of PT MNC i.e., PT MNC and Pt Pakuan go up and down completely randomly.
Pair Corralation between PT MNC and Pt Pakuan
Assuming the 90 days trading horizon PT MNC is expected to generate 5.01 times less return on investment than Pt Pakuan. But when comparing it to its historical volatility, PT MNC Energy is 2.03 times less risky than Pt Pakuan. It trades about 0.01 of its potential returns per unit of risk. Pt Pakuan Tbk is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 55,563 in Pt Pakuan Tbk on October 25, 2024 and sell it today you would lose (6,563) from holding Pt Pakuan Tbk or give up 11.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT MNC Energy vs. Pt Pakuan Tbk
Performance |
| Timeline |
| PT MNC Energy |
| Pt Pakuan Tbk |
PT MNC and Pt Pakuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT MNC and Pt Pakuan
The main advantage of trading using opposite PT MNC and Pt Pakuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT MNC position performs unexpectedly, Pt Pakuan 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 Pakuan will offset losses from the drop in Pt Pakuan's long position.| PT MNC vs. Mnc Investama Tbk | PT MNC vs. Exploitasi Energi Indonesia | PT MNC vs. Smartfren Telecom Tbk | PT MNC vs. Humpuss Intermoda Transportasi |
| Pt Pakuan vs. Perintis Triniti Properti | Pt Pakuan vs. Satria Mega Kencana | Pt Pakuan vs. Sunindo Adipersada Tbk | Pt Pakuan vs. Jaya Sukses Makmur |
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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