Correlation Between Jasa Armada and PT MNC
Can any of the company-specific risk be diversified away by investing in both Jasa Armada and PT MNC 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 Jasa Armada and PT MNC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jasa Armada Indonesia and PT MNC Energy, you can compare the effects of market volatilities on Jasa Armada and PT MNC 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 Jasa Armada with a short position of PT MNC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jasa Armada and PT MNC.
Diversification Opportunities for Jasa Armada and PT MNC
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jasa and IATA is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Jasa Armada Indonesia and PT MNC Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT MNC Energy and Jasa Armada 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 Jasa Armada Indonesia are associated (or correlated) with PT MNC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT MNC Energy has no effect on the direction of Jasa Armada i.e., Jasa Armada and PT MNC go up and down completely randomly.
Pair Corralation between Jasa Armada and PT MNC
Assuming the 90 days trading horizon Jasa Armada is expected to generate 573.92 times less return on investment than PT MNC. But when comparing it to its historical volatility, Jasa Armada Indonesia is 5.99 times less risky than PT MNC. It trades about 0.0 of its potential returns per unit of risk. PT MNC Energy is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 3,800 in PT MNC Energy on September 2, 2024 and sell it today you would earn a total of 600.00 from holding PT MNC Energy or generate 15.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jasa Armada Indonesia vs. PT MNC Energy
Performance |
| Timeline |
| Jasa Armada Indonesia |
| PT MNC Energy |
Jasa Armada and PT MNC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jasa Armada and PT MNC
The main advantage of trading using opposite Jasa Armada and PT MNC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jasa Armada position performs unexpectedly, PT MNC 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 MNC will offset losses from the drop in PT MNC's long position.| Jasa Armada vs. PT Indonesia Kendaraan | Jasa Armada vs. PP Presisi Tbk | Jasa Armada vs. Cikarang Listrindo Tbk | Jasa Armada vs. Pelita Samudera Shipping |
| PT MNC vs. Matahari Department Store | PT MNC vs. Multi Medika Internasional | PT MNC vs. Visi Media Asia | PT MNC vs. Bayan Resources 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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