Correlation Between Sentral Mitra and Mitrabara Adiperdana
Can any of the company-specific risk be diversified away by investing in both Sentral Mitra and Mitrabara Adiperdana 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 Mitrabara Adiperdana 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 Mitrabara Adiperdana PT, you can compare the effects of market volatilities on Sentral Mitra and Mitrabara Adiperdana 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 Mitrabara Adiperdana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sentral Mitra and Mitrabara Adiperdana.
Diversification Opportunities for Sentral Mitra and Mitrabara Adiperdana
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sentral and Mitrabara is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Sentral Mitra Informatika and Mitrabara Adiperdana PT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mitrabara Adiperdana 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 Mitrabara Adiperdana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mitrabara Adiperdana has no effect on the direction of Sentral Mitra i.e., Sentral Mitra and Mitrabara Adiperdana go up and down completely randomly.
Pair Corralation between Sentral Mitra and Mitrabara Adiperdana
Assuming the 90 days trading horizon Sentral Mitra Informatika is expected to generate 1.91 times more return on investment than Mitrabara Adiperdana. However, Sentral Mitra is 1.91 times more volatile than Mitrabara Adiperdana PT. It trades about -0.02 of its potential returns per unit of risk. Mitrabara Adiperdana PT is currently generating about -0.05 per unit of risk. If you would invest 9,700 in Sentral Mitra Informatika on August 31, 2024 and sell it today you would lose (3,200) from holding Sentral Mitra Informatika or give up 32.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sentral Mitra Informatika vs. Mitrabara Adiperdana PT
Performance |
| Timeline |
| Sentral Mitra Informatika |
| Mitrabara Adiperdana |
Sentral Mitra and Mitrabara Adiperdana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sentral Mitra and Mitrabara Adiperdana
The main advantage of trading using opposite Sentral Mitra and Mitrabara Adiperdana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sentral Mitra position performs unexpectedly, Mitrabara Adiperdana 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 Mitrabara Adiperdana will offset losses from the drop in Mitrabara Adiperdana's long position.| Sentral Mitra vs. PT Dewi Shri | Sentral Mitra vs. Habco Trans Maritima | Sentral Mitra vs. PT Jhonlin Agro | Sentral Mitra vs. Autopedia Sukses Lestari |
| Mitrabara Adiperdana vs. Baramulti Suksessarana Tbk | Mitrabara Adiperdana vs. Samindo Resources Tbk | Mitrabara Adiperdana vs. Hexindo Adiperkasa Tbk | Mitrabara Adiperdana vs. Mitra Pinasthika Mustika |
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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