Correlation Between Sentral Mitra and Kioson Komersial
Can any of the company-specific risk be diversified away by investing in both Sentral Mitra and Kioson Komersial 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 Sentral Mitra and Kioson Komersial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sentral Mitra Informatika and Kioson Komersial Indonesia, you can compare the effects of market volatilities on Sentral Mitra and Kioson Komersial 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 Sentral Mitra with a short position of Kioson Komersial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sentral Mitra and Kioson Komersial.
Diversification Opportunities for Sentral Mitra and Kioson Komersial
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sentral and Kioson is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Sentral Mitra Informatika and Kioson Komersial Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kioson Komersial Ind and Sentral Mitra 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 Sentral Mitra Informatika are associated (or correlated) with Kioson Komersial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kioson Komersial Ind has no effect on the direction of Sentral Mitra i.e., Sentral Mitra and Kioson Komersial go up and down completely randomly.
Pair Corralation between Sentral Mitra and Kioson Komersial
Assuming the 90 days trading horizon Sentral Mitra Informatika is expected to generate 1.16 times more return on investment than Kioson Komersial. However, Sentral Mitra is 1.16 times more volatile than Kioson Komersial Indonesia. It trades about -0.03 of its potential returns per unit of risk. Kioson Komersial Indonesia is currently generating about -0.11 per unit of risk. If you would invest 13,100 in Sentral Mitra Informatika on September 4, 2024 and sell it today you would lose (6,700) from holding Sentral Mitra Informatika or give up 51.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Sentral Mitra Informatika vs. Kioson Komersial Indonesia
Performance |
| Timeline |
| Sentral Mitra Informatika |
| Kioson Komersial Ind |
Sentral Mitra and Kioson Komersial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sentral Mitra and Kioson Komersial
The main advantage of trading using opposite Sentral Mitra and Kioson Komersial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sentral Mitra position performs unexpectedly, Kioson Komersial 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 Kioson Komersial will offset losses from the drop in Kioson Komersial's long position.| Sentral Mitra vs. Kioson Komersial Indonesia | Sentral Mitra vs. Multipolar Technology Tbk | Sentral Mitra vs. Hensel Davest Indonesia | Sentral Mitra vs. NFC Indonesia PT |
| Kioson Komersial vs. M Cash Integrasi | Kioson Komersial vs. NFC Indonesia PT | Kioson Komersial vs. Multipolar Technology Tbk | Kioson Komersial vs. Digital Mediatama Maxima |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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