Correlation Between Mitrabara Adiperdana and Baramulti Suksessarana
Can any of the company-specific risk be diversified away by investing in both Mitrabara Adiperdana and Baramulti Suksessarana 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 Mitrabara Adiperdana and Baramulti Suksessarana into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mitrabara Adiperdana PT and Baramulti Suksessarana Tbk, you can compare the effects of market volatilities on Mitrabara Adiperdana and Baramulti Suksessarana 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 Mitrabara Adiperdana with a short position of Baramulti Suksessarana. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitrabara Adiperdana and Baramulti Suksessarana.
Diversification Opportunities for Mitrabara Adiperdana and Baramulti Suksessarana
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mitrabara and Baramulti is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Mitrabara Adiperdana PT and Baramulti Suksessarana Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baramulti Suksessarana and Mitrabara Adiperdana 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 Mitrabara Adiperdana PT are associated (or correlated) with Baramulti Suksessarana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baramulti Suksessarana has no effect on the direction of Mitrabara Adiperdana i.e., Mitrabara Adiperdana and Baramulti Suksessarana go up and down completely randomly.
Pair Corralation between Mitrabara Adiperdana and Baramulti Suksessarana
Assuming the 90 days trading horizon Mitrabara Adiperdana PT is expected to under-perform the Baramulti Suksessarana. But the stock apears to be less risky and, when comparing its historical volatility, Mitrabara Adiperdana PT is 1.49 times less risky than Baramulti Suksessarana. The stock trades about -0.42 of its potential returns per unit of risk. The Baramulti Suksessarana Tbk is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 427,891 in Baramulti Suksessarana Tbk on August 26, 2024 and sell it today you would earn a total of 1,109 from holding Baramulti Suksessarana Tbk or generate 0.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mitrabara Adiperdana PT vs. Baramulti Suksessarana Tbk
Performance |
| Timeline |
| Mitrabara Adiperdana |
| Baramulti Suksessarana |
Mitrabara Adiperdana and Baramulti Suksessarana Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mitrabara Adiperdana and Baramulti Suksessarana
The main advantage of trading using opposite Mitrabara Adiperdana and Baramulti Suksessarana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mitrabara Adiperdana position performs unexpectedly, Baramulti Suksessarana 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 Baramulti Suksessarana will offset losses from the drop in Baramulti Suksessarana's long position.| Mitrabara Adiperdana vs. Baramulti Suksessarana Tbk | Mitrabara Adiperdana vs. Samindo Resources Tbk | Mitrabara Adiperdana vs. Hexindo Adiperkasa Tbk | Mitrabara Adiperdana vs. Mitra Pinasthika Mustika |
| Baramulti Suksessarana vs. Mitrabara Adiperdana PT | Baramulti Suksessarana vs. Bayan Resources Tbk | Baramulti Suksessarana vs. Abm Investama Tbk | Baramulti Suksessarana vs. TBS Energi Utama |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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