Correlation Between Matahari Department and Protech Mitra
Can any of the company-specific risk be diversified away by investing in both Matahari Department and Protech Mitra 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 Matahari Department and Protech Mitra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Matahari Department Store and Protech Mitra Perkasa, you can compare the effects of market volatilities on Matahari Department and Protech Mitra 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 Matahari Department with a short position of Protech Mitra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Matahari Department and Protech Mitra.
Diversification Opportunities for Matahari Department and Protech Mitra
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Matahari and Protech is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Matahari Department Store and Protech Mitra Perkasa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Protech Mitra Perkasa and Matahari Department 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 Matahari Department Store are associated (or correlated) with Protech Mitra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Protech Mitra Perkasa has no effect on the direction of Matahari Department i.e., Matahari Department and Protech Mitra go up and down completely randomly.
Pair Corralation between Matahari Department and Protech Mitra
Assuming the 90 days trading horizon Matahari Department Store is expected to under-perform the Protech Mitra. In addition to that, Matahari Department is 1.24 times more volatile than Protech Mitra Perkasa. It trades about -0.16 of its total potential returns per unit of risk. Protech Mitra Perkasa is currently generating about -0.03 per unit of volatility. If you would invest 13,800 in Protech Mitra Perkasa on August 31, 2024 and sell it today you would lose (300.00) from holding Protech Mitra Perkasa or give up 2.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Matahari Department Store vs. Protech Mitra Perkasa
Performance |
| Timeline |
| Matahari Department Store |
| Protech Mitra Perkasa |
Matahari Department and Protech Mitra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Matahari Department and Protech Mitra
The main advantage of trading using opposite Matahari Department and Protech Mitra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Matahari Department position performs unexpectedly, Protech Mitra 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 Protech Mitra will offset losses from the drop in Protech Mitra's long position.| Matahari Department vs. Surya Citra Media | Matahari Department vs. Akr Corporindo Tbk | Matahari Department vs. Media Nusantara Citra | Matahari Department vs. Pembangunan Perumahan PT |
| Protech Mitra vs. Matahari Department Store | Protech Mitra vs. Multi Medika Internasional | Protech Mitra vs. Visi Media Asia | Protech Mitra vs. Bayan Resources 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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