Correlation Between Merdeka Copper and Bank Victoria
Can any of the company-specific risk be diversified away by investing in both Merdeka Copper and Bank Victoria 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 Merdeka Copper and Bank Victoria into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Merdeka Copper Gold and Bank Victoria International, you can compare the effects of market volatilities on Merdeka Copper and Bank Victoria 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 Merdeka Copper with a short position of Bank Victoria. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merdeka Copper and Bank Victoria.
Diversification Opportunities for Merdeka Copper and Bank Victoria
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Merdeka and Bank is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Merdeka Copper Gold and Bank Victoria International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank Victoria Intern and Merdeka Copper 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 Merdeka Copper Gold are associated (or correlated) with Bank Victoria. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank Victoria Intern has no effect on the direction of Merdeka Copper i.e., Merdeka Copper and Bank Victoria go up and down completely randomly.
Pair Corralation between Merdeka Copper and Bank Victoria
Assuming the 90 days trading horizon Merdeka Copper Gold is expected to under-perform the Bank Victoria. But the stock apears to be less risky and, when comparing its historical volatility, Merdeka Copper Gold is 1.53 times less risky than Bank Victoria. The stock trades about -0.17 of its potential returns per unit of risk. The Bank Victoria International is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 8,300 in Bank Victoria International on September 2, 2024 and sell it today you would earn a total of 1,100 from holding Bank Victoria International or generate 13.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Merdeka Copper Gold vs. Bank Victoria International
Performance |
| Timeline |
| Merdeka Copper Gold |
| Bank Victoria Intern |
Merdeka Copper and Bank Victoria Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merdeka Copper and Bank Victoria
The main advantage of trading using opposite Merdeka Copper and Bank Victoria positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merdeka Copper position performs unexpectedly, Bank Victoria 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 Bank Victoria will offset losses from the drop in Bank Victoria's long position.| Merdeka Copper vs. Perusahaan Gas Negara | Merdeka Copper vs. Telkom Indonesia Tbk | Merdeka Copper vs. Mitra Pinasthika Mustika | Merdeka Copper vs. Jakarta Int Hotels |
| Bank Victoria vs. Ace Hardware Indonesia | Bank Victoria vs. Merdeka Copper Gold | Bank Victoria vs. Mitra Pinasthika Mustika | Bank Victoria vs. Jakarta Int Hotels |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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