Correlation Between Link Net and Energi Mega
Can any of the company-specific risk be diversified away by investing in both Link Net and Energi Mega 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 Link Net and Energi Mega into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Link Net Tbk and Energi Mega Persada, you can compare the effects of market volatilities on Link Net and Energi Mega 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 Link Net with a short position of Energi Mega. Check out your portfolio center. Please also check ongoing floating volatility patterns of Link Net and Energi Mega.
Diversification Opportunities for Link Net and Energi Mega
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Link and Energi is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Link Net Tbk and Energi Mega Persada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energi Mega Persada and Link Net 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 Link Net Tbk are associated (or correlated) with Energi Mega. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energi Mega Persada has no effect on the direction of Link Net i.e., Link Net and Energi Mega go up and down completely randomly.
Pair Corralation between Link Net and Energi Mega
Assuming the 90 days trading horizon Link Net Tbk is expected to generate 0.82 times more return on investment than Energi Mega. However, Link Net Tbk is 1.22 times less risky than Energi Mega. It trades about -0.04 of its potential returns per unit of risk. Energi Mega Persada is currently generating about -0.15 per unit of risk. If you would invest 132,000 in Link Net Tbk on September 5, 2024 and sell it today you would lose (5,500) from holding Link Net Tbk or give up 4.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Link Net Tbk vs. Energi Mega Persada
Performance |
| Timeline |
| Link Net Tbk |
| Energi Mega Persada |
Link Net and Energi Mega Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Link Net and Energi Mega
The main advantage of trading using opposite Link Net and Energi Mega positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Link Net position performs unexpectedly, Energi Mega 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 Energi Mega will offset losses from the drop in Energi Mega's long position.| Link Net vs. Energi Mega Persada | Link Net vs. Mitra Pinasthika Mustika | Link Net vs. Jakarta Int Hotels | Link Net vs. Indosat Tbk |
| Energi Mega vs. Weha Transportasi Indonesia | Energi Mega vs. Mitra Pinasthika Mustika | Energi Mega vs. Jakarta Int Hotels | Energi Mega vs. Asuransi Harta Aman |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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