Correlation Between First Media and HK Metals
Can any of the company-specific risk be diversified away by investing in both First Media and HK Metals 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 First Media and HK Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Media Tbk and HK Metals Utama, you can compare the effects of market volatilities on First Media and HK Metals 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 First Media with a short position of HK Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Media and HK Metals.
Diversification Opportunities for First Media and HK Metals
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between First and HKMU is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding First Media Tbk and HK Metals Utama in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HK Metals Utama and First Media 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 First Media Tbk are associated (or correlated) with HK Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HK Metals Utama has no effect on the direction of First Media i.e., First Media and HK Metals go up and down completely randomly.
Pair Corralation between First Media and HK Metals
If you would invest 8,000 in First Media Tbk on August 30, 2024 and sell it today you would earn a total of 1,800 from holding First Media Tbk or generate 22.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Media Tbk vs. HK Metals Utama
Performance |
| Timeline |
| First Media Tbk |
| HK Metals Utama |
First Media and HK Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Media and HK Metals
The main advantage of trading using opposite First Media and HK Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Media position performs unexpectedly, HK Metals 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 HK Metals will offset losses from the drop in HK Metals' long position.| First Media vs. Bank Artos Indonesia | First Media vs. PT Bukalapak | First Media vs. Sumber Alfaria Trijaya | First Media vs. Merdeka Copper Gold |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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