Correlation Between Mark Dynamics and Intanwijaya Internasional
Can any of the company-specific risk be diversified away by investing in both Mark Dynamics and Intanwijaya Internasional 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 Mark Dynamics and Intanwijaya Internasional into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mark Dynamics Indonesia and Intanwijaya Internasional Tbk, you can compare the effects of market volatilities on Mark Dynamics and Intanwijaya Internasional 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 Mark Dynamics with a short position of Intanwijaya Internasional. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mark Dynamics and Intanwijaya Internasional.
Diversification Opportunities for Mark Dynamics and Intanwijaya Internasional
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mark and Intanwijaya is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Mark Dynamics Indonesia and Intanwijaya Internasional Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intanwijaya Internasional and Mark Dynamics 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 Mark Dynamics Indonesia are associated (or correlated) with Intanwijaya Internasional. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intanwijaya Internasional has no effect on the direction of Mark Dynamics i.e., Mark Dynamics and Intanwijaya Internasional go up and down completely randomly.
Pair Corralation between Mark Dynamics and Intanwijaya Internasional
Assuming the 90 days trading horizon Mark Dynamics Indonesia is expected to under-perform the Intanwijaya Internasional. In addition to that, Mark Dynamics is 1.58 times more volatile than Intanwijaya Internasional Tbk. It trades about -0.1 of its total potential returns per unit of risk. Intanwijaya Internasional Tbk is currently generating about -0.15 per unit of volatility. If you would invest 60,500 in Intanwijaya Internasional Tbk on August 25, 2024 and sell it today you would lose (3,000) from holding Intanwijaya Internasional Tbk or give up 4.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mark Dynamics Indonesia vs. Intanwijaya Internasional Tbk
Performance |
| Timeline |
| Mark Dynamics Indonesia |
| Intanwijaya Internasional |
Mark Dynamics and Intanwijaya Internasional Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mark Dynamics and Intanwijaya Internasional
The main advantage of trading using opposite Mark Dynamics and Intanwijaya Internasional positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mark Dynamics position performs unexpectedly, Intanwijaya Internasional 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 Intanwijaya Internasional will offset losses from the drop in Intanwijaya Internasional's long position.| Mark Dynamics vs. Samudera Indonesia Tbk | Mark Dynamics vs. Rukun Raharja Tbk | Mark Dynamics vs. PT Temas Tbk | Mark Dynamics vs. Weha Transportasi Indonesia |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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