Correlation Between Mahaka Radio and Metro Healthcare
Can any of the company-specific risk be diversified away by investing in both Mahaka Radio and Metro Healthcare 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 Mahaka Radio and Metro Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mahaka Radio Integra and Metro Healthcare Indonesia, you can compare the effects of market volatilities on Mahaka Radio and Metro Healthcare 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 Mahaka Radio with a short position of Metro Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mahaka Radio and Metro Healthcare.
Diversification Opportunities for Mahaka Radio and Metro Healthcare
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Mahaka and Metro is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Mahaka Radio Integra and Metro Healthcare Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro Healthcare Ind and Mahaka Radio 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 Mahaka Radio Integra are associated (or correlated) with Metro Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro Healthcare Ind has no effect on the direction of Mahaka Radio i.e., Mahaka Radio and Metro Healthcare go up and down completely randomly.
Pair Corralation between Mahaka Radio and Metro Healthcare
Assuming the 90 days trading horizon Mahaka Radio Integra is expected to generate 0.8 times more return on investment than Metro Healthcare. However, Mahaka Radio Integra is 1.24 times less risky than Metro Healthcare. It trades about -0.03 of its potential returns per unit of risk. Metro Healthcare Indonesia is currently generating about -0.05 per unit of risk. If you would invest 9,800 in Mahaka Radio Integra on August 25, 2024 and sell it today you would lose (4,800) from holding Mahaka Radio Integra or give up 48.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mahaka Radio Integra vs. Metro Healthcare Indonesia
Performance |
| Timeline |
| Mahaka Radio Integra |
| Metro Healthcare Ind |
Mahaka Radio and Metro Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mahaka Radio and Metro Healthcare
The main advantage of trading using opposite Mahaka Radio and Metro Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mahaka Radio position performs unexpectedly, Metro Healthcare 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 Metro Healthcare will offset losses from the drop in Metro Healthcare's long position.| Mahaka Radio vs. Mnc Land Tbk | Mahaka Radio vs. MNC Vision Networks | Mahaka Radio vs. MD Pictures Tbk | Mahaka Radio vs. Link Net Tbk |
| Metro Healthcare vs. Medikaloka Hermina PT | Metro Healthcare vs. Mitra Keluarga Karyasehat | Metro Healthcare vs. Bhakti Multi Artha | Metro Healthcare vs. Surya Permata Andalan |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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