Correlation Between Kalbe Farma and Matahari Putra
Can any of the company-specific risk be diversified away by investing in both Kalbe Farma and Matahari Putra 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 Kalbe Farma and Matahari Putra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kalbe Farma Tbk and Matahari Putra Prima, you can compare the effects of market volatilities on Kalbe Farma and Matahari Putra 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 Kalbe Farma with a short position of Matahari Putra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kalbe Farma and Matahari Putra.
Diversification Opportunities for Kalbe Farma and Matahari Putra
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kalbe and Matahari is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Kalbe Farma Tbk and Matahari Putra Prima in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matahari Putra Prima and Kalbe Farma 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 Kalbe Farma Tbk are associated (or correlated) with Matahari Putra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matahari Putra Prima has no effect on the direction of Kalbe Farma i.e., Kalbe Farma and Matahari Putra go up and down completely randomly.
Pair Corralation between Kalbe Farma and Matahari Putra
Assuming the 90 days trading horizon Kalbe Farma Tbk is expected to under-perform the Matahari Putra. But the stock apears to be less risky and, when comparing its historical volatility, Kalbe Farma Tbk is 4.88 times less risky than Matahari Putra. The stock trades about -0.11 of its potential returns per unit of risk. The Matahari Putra Prima is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 5,000 in Matahari Putra Prima on August 31, 2024 and sell it today you would earn a total of 2,100 from holding Matahari Putra Prima or generate 42.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kalbe Farma Tbk vs. Matahari Putra Prima
Performance |
| Timeline |
| Kalbe Farma Tbk |
| Matahari Putra Prima |
Kalbe Farma and Matahari Putra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kalbe Farma and Matahari Putra
The main advantage of trading using opposite Kalbe Farma and Matahari Putra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kalbe Farma position performs unexpectedly, Matahari Putra 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 Matahari Putra will offset losses from the drop in Matahari Putra's long position.| Kalbe Farma vs. PT Indofood Sukses | Kalbe Farma vs. Unilever Indonesia Tbk | Kalbe Farma vs. Semen Indonesia Persero | Kalbe Farma vs. United Tractors Tbk |
| Matahari Putra vs. Multipolar Tbk | Matahari Putra vs. Ramayana Lestari Sentosa | Matahari Putra vs. Lippo Karawaci Tbk | Matahari Putra vs. Mitra Adiperkasa 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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