Correlation Between Kalbe Farma and Mayora Indah
Can any of the company-specific risk be diversified away by investing in both Kalbe Farma and Mayora Indah 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 Mayora Indah 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 Mayora Indah Tbk, you can compare the effects of market volatilities on Kalbe Farma and Mayora Indah 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 Mayora Indah. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kalbe Farma and Mayora Indah.
Diversification Opportunities for Kalbe Farma and Mayora Indah
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kalbe and Mayora is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Kalbe Farma Tbk and Mayora Indah Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mayora Indah Tbk 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 Mayora Indah. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mayora Indah Tbk has no effect on the direction of Kalbe Farma i.e., Kalbe Farma and Mayora Indah go up and down completely randomly.
Pair Corralation between Kalbe Farma and Mayora Indah
Assuming the 90 days trading horizon Kalbe Farma Tbk is expected to under-perform the Mayora Indah. But the stock apears to be less risky and, when comparing its historical volatility, Kalbe Farma Tbk is 1.15 times less risky than Mayora Indah. The stock trades about -0.25 of its potential returns per unit of risk. The Mayora Indah Tbk is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 261,000 in Mayora Indah Tbk on August 29, 2024 and sell it today you would earn a total of 13,000 from holding Mayora Indah Tbk or generate 4.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kalbe Farma Tbk vs. Mayora Indah Tbk
Performance |
| Timeline |
| Kalbe Farma Tbk |
| Mayora Indah Tbk |
Kalbe Farma and Mayora Indah Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kalbe Farma and Mayora Indah
The main advantage of trading using opposite Kalbe Farma and Mayora Indah positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kalbe Farma position performs unexpectedly, Mayora Indah 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 Mayora Indah will offset losses from the drop in Mayora Indah'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 |
| Mayora Indah vs. Indofood Cbp Sukses | Mayora Indah vs. Kalbe Farma Tbk | Mayora Indah vs. Unilever Indonesia Tbk | Mayora Indah vs. Ultra Jaya Milk |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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