Correlation Between Macys and PT Mitra
Can any of the company-specific risk be diversified away by investing in both Macys and PT 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 Macys and PT Mitra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macys Inc and PT Mitra Adiperkasa, you can compare the effects of market volatilities on Macys and PT 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 Macys with a short position of PT Mitra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macys and PT Mitra.
Diversification Opportunities for Macys and PT Mitra
Significant diversification
The 3 months correlation between Macys and PMDKF is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Macys Inc and PT Mitra Adiperkasa in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Mitra Adiperkasa and Macys 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 Macys Inc are associated (or correlated) with PT Mitra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Mitra Adiperkasa has no effect on the direction of Macys i.e., Macys and PT Mitra go up and down completely randomly.
Pair Corralation between Macys and PT Mitra
If you would invest 1,534 in Macys Inc on August 24, 2024 and sell it today you would earn a total of 83.50 from holding Macys Inc or generate 5.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Macys Inc vs. PT Mitra Adiperkasa
Performance |
| Timeline |
| Macys Inc |
| PT Mitra Adiperkasa |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Macys and PT Mitra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macys and PT Mitra
The main advantage of trading using opposite Macys and PT Mitra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macys position performs unexpectedly, PT 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 PT Mitra will offset losses from the drop in PT Mitra's long position.The idea behind Macys Inc and PT Mitra Adiperkasa pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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