Correlation Between Mark Dynamics and Prodia Widyahusada
Can any of the company-specific risk be diversified away by investing in both Mark Dynamics and Prodia Widyahusada 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 Prodia Widyahusada 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 Prodia Widyahusada Tbk, you can compare the effects of market volatilities on Mark Dynamics and Prodia Widyahusada 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 Prodia Widyahusada. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mark Dynamics and Prodia Widyahusada.
Diversification Opportunities for Mark Dynamics and Prodia Widyahusada
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mark and Prodia is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Mark Dynamics Indonesia and Prodia Widyahusada Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Prodia Widyahusada Tbk 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 Prodia Widyahusada. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Prodia Widyahusada Tbk has no effect on the direction of Mark Dynamics i.e., Mark Dynamics and Prodia Widyahusada go up and down completely randomly.
Pair Corralation between Mark Dynamics and Prodia Widyahusada
Assuming the 90 days trading horizon Mark Dynamics Indonesia is expected to generate 1.66 times more return on investment than Prodia Widyahusada. However, Mark Dynamics is 1.66 times more volatile than Prodia Widyahusada Tbk. It trades about -0.1 of its potential returns per unit of risk. Prodia Widyahusada Tbk is currently generating about -0.25 per unit of risk. If you would invest 108,896 in Mark Dynamics Indonesia on August 25, 2024 and sell it today you would lose (5,896) from holding Mark Dynamics Indonesia or give up 5.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mark Dynamics Indonesia vs. Prodia Widyahusada Tbk
Performance |
| Timeline |
| Mark Dynamics Indonesia |
| Prodia Widyahusada Tbk |
Mark Dynamics and Prodia Widyahusada Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mark Dynamics and Prodia Widyahusada
The main advantage of trading using opposite Mark Dynamics and Prodia Widyahusada positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mark Dynamics position performs unexpectedly, Prodia Widyahusada 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 Prodia Widyahusada will offset losses from the drop in Prodia Widyahusada'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 |
| Prodia Widyahusada vs. Medikaloka Hermina PT | Prodia Widyahusada vs. Mitra Keluarga Karyasehat | Prodia Widyahusada vs. Siloam International Hospitals | Prodia Widyahusada vs. Saratoga Investama Sedaya |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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