Correlation Between Indofood Cbp and Mnc Kapital
Can any of the company-specific risk be diversified away by investing in both Indofood Cbp and Mnc Kapital 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 Indofood Cbp and Mnc Kapital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Indofood Cbp Sukses and Mnc Kapital Indonesia, you can compare the effects of market volatilities on Indofood Cbp and Mnc Kapital 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 Indofood Cbp with a short position of Mnc Kapital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indofood Cbp and Mnc Kapital.
Diversification Opportunities for Indofood Cbp and Mnc Kapital
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Indofood and Mnc is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Indofood Cbp Sukses and Mnc Kapital Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mnc Kapital Indonesia and Indofood Cbp 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 Indofood Cbp Sukses are associated (or correlated) with Mnc Kapital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mnc Kapital Indonesia has no effect on the direction of Indofood Cbp i.e., Indofood Cbp and Mnc Kapital go up and down completely randomly.
Pair Corralation between Indofood Cbp and Mnc Kapital
Assuming the 90 days trading horizon Indofood Cbp Sukses is expected to generate 0.47 times more return on investment than Mnc Kapital. However, Indofood Cbp Sukses is 2.13 times less risky than Mnc Kapital. It trades about 0.03 of its potential returns per unit of risk. Mnc Kapital Indonesia is currently generating about 0.0 per unit of risk. If you would invest 983,887 in Indofood Cbp Sukses on August 29, 2024 and sell it today you would earn a total of 213,613 from holding Indofood Cbp Sukses or generate 21.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Indofood Cbp Sukses vs. Mnc Kapital Indonesia
Performance |
| Timeline |
| Indofood Cbp Sukses |
| Mnc Kapital Indonesia |
Indofood Cbp and Mnc Kapital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indofood Cbp and Mnc Kapital
The main advantage of trading using opposite Indofood Cbp and Mnc Kapital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indofood Cbp position performs unexpectedly, Mnc Kapital 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 Kapital will offset losses from the drop in Mnc Kapital's long position.| Indofood Cbp vs. Bakrieland Development Tbk | Indofood Cbp vs. Bakrie Brothers Tbk | Indofood Cbp vs. Energi Mega Persada | Indofood Cbp vs. Sampoerna Agro Tbk |
| Mnc Kapital vs. Kedawung Setia Industrial | Mnc Kapital vs. Nanotech Indonesia Global | Mnc Kapital vs. Dharma Polimetal Tbk | Mnc Kapital vs. Bank Ocbc Nisp |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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