Correlation Between Kirana Megatara and Kabelindo Murni
Can any of the company-specific risk be diversified away by investing in both Kirana Megatara and Kabelindo Murni 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 Kirana Megatara and Kabelindo Murni into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kirana Megatara Tbk and Kabelindo Murni Tbk, you can compare the effects of market volatilities on Kirana Megatara and Kabelindo Murni 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 Kirana Megatara with a short position of Kabelindo Murni. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kirana Megatara and Kabelindo Murni.
Diversification Opportunities for Kirana Megatara and Kabelindo Murni
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kirana and Kabelindo is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Kirana Megatara Tbk and Kabelindo Murni Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kabelindo Murni Tbk and Kirana Megatara 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 Kirana Megatara Tbk are associated (or correlated) with Kabelindo Murni. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kabelindo Murni Tbk has no effect on the direction of Kirana Megatara i.e., Kirana Megatara and Kabelindo Murni go up and down completely randomly.
Pair Corralation between Kirana Megatara and Kabelindo Murni
Assuming the 90 days trading horizon Kirana Megatara Tbk is expected to under-perform the Kabelindo Murni. In addition to that, Kirana Megatara is 1.53 times more volatile than Kabelindo Murni Tbk. It trades about -0.15 of its total potential returns per unit of risk. Kabelindo Murni Tbk is currently generating about 0.04 per unit of volatility. If you would invest 30,400 in Kabelindo Murni Tbk on August 28, 2024 and sell it today you would earn a total of 400.00 from holding Kabelindo Murni Tbk or generate 1.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kirana Megatara Tbk vs. Kabelindo Murni Tbk
Performance |
| Timeline |
| Kirana Megatara Tbk |
| Kabelindo Murni Tbk |
Kirana Megatara and Kabelindo Murni Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kirana Megatara and Kabelindo Murni
The main advantage of trading using opposite Kirana Megatara and Kabelindo Murni positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kirana Megatara position performs unexpectedly, Kabelindo Murni 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 Kabelindo Murni will offset losses from the drop in Kabelindo Murni's long position.| Kirana Megatara vs. Emdeki Utama Tbk | Kirana Megatara vs. Panca Budi Idaman | Kirana Megatara vs. Mark Dynamics Indonesia | Kirana Megatara vs. Map Boga Adiperkasa |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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