Correlation Between Indofood Cbp and Mitra Pinasthika
Can any of the company-specific risk be diversified away by investing in both Indofood Cbp and Mitra Pinasthika 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 Mitra Pinasthika 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 Mitra Pinasthika Mustika, you can compare the effects of market volatilities on Indofood Cbp and Mitra Pinasthika 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 Mitra Pinasthika. Check out your portfolio center. Please also check ongoing floating volatility patterns of Indofood Cbp and Mitra Pinasthika.
Diversification Opportunities for Indofood Cbp and Mitra Pinasthika
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Indofood and Mitra is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Indofood Cbp Sukses and Mitra Pinasthika Mustika in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitra Pinasthika Mustika 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 Mitra Pinasthika. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitra Pinasthika Mustika has no effect on the direction of Indofood Cbp i.e., Indofood Cbp and Mitra Pinasthika go up and down completely randomly.
Pair Corralation between Indofood Cbp and Mitra Pinasthika
Assuming the 90 days trading horizon Indofood Cbp Sukses is expected to generate 1.62 times more return on investment than Mitra Pinasthika. However, Indofood Cbp is 1.62 times more volatile than Mitra Pinasthika Mustika. It trades about 0.1 of its potential returns per unit of risk. Mitra Pinasthika Mustika is currently generating about 0.04 per unit of risk. If you would invest 1,012,644 in Indofood Cbp Sukses on September 2, 2024 and sell it today you would earn a total of 177,356 from holding Indofood Cbp Sukses or generate 17.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Indofood Cbp Sukses vs. Mitra Pinasthika Mustika
Performance |
| Timeline |
| Indofood Cbp Sukses |
| Mitra Pinasthika Mustika |
Indofood Cbp and Mitra Pinasthika Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Indofood Cbp and Mitra Pinasthika
The main advantage of trading using opposite Indofood Cbp and Mitra Pinasthika positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Indofood Cbp position performs unexpectedly, Mitra Pinasthika 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 Mitra Pinasthika will offset losses from the drop in Mitra Pinasthika's long position.| Indofood Cbp vs. Unilever Indonesia Tbk | Indofood Cbp vs. PT Indofood Sukses | Indofood Cbp vs. Astra International Tbk | Indofood Cbp vs. Telkom Indonesia Tbk |
| Mitra Pinasthika vs. Saratoga Investama Sedaya | Mitra Pinasthika vs. Puradelta Lestari PT | Mitra Pinasthika vs. Cikarang Listrindo Tbk | Mitra Pinasthika vs. Erajaya Swasembada Tbk |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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