Correlation Between Merdeka Copper and Multi Indocitra
Can any of the company-specific risk be diversified away by investing in both Merdeka Copper and Multi Indocitra 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 Multi Indocitra 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 Multi Indocitra Tbk, you can compare the effects of market volatilities on Merdeka Copper and Multi Indocitra 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 Multi Indocitra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merdeka Copper and Multi Indocitra.
Diversification Opportunities for Merdeka Copper and Multi Indocitra
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Merdeka and Multi is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Merdeka Copper Gold and Multi Indocitra Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Indocitra Tbk 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 Multi Indocitra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Indocitra Tbk has no effect on the direction of Merdeka Copper i.e., Merdeka Copper and Multi Indocitra go up and down completely randomly.
Pair Corralation between Merdeka Copper and Multi Indocitra
Assuming the 90 days trading horizon Merdeka Copper Gold is expected to under-perform the Multi Indocitra. In addition to that, Merdeka Copper is 1.11 times more volatile than Multi Indocitra Tbk. It trades about -0.05 of its total potential returns per unit of risk. Multi Indocitra Tbk is currently generating about 0.02 per unit of volatility. If you would invest 48,146 in Multi Indocitra Tbk on August 28, 2024 and sell it today you would earn a total of 2,354 from holding Multi Indocitra Tbk or generate 4.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.78% |
| Values | Daily Returns |
Merdeka Copper Gold vs. Multi Indocitra Tbk
Performance |
| Timeline |
| Merdeka Copper Gold |
| Multi Indocitra Tbk |
Merdeka Copper and Multi Indocitra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merdeka Copper and Multi Indocitra
The main advantage of trading using opposite Merdeka Copper and Multi Indocitra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merdeka Copper position performs unexpectedly, Multi Indocitra 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 Multi Indocitra will offset losses from the drop in Multi Indocitra's long position.| Merdeka Copper vs. PT Sarana Menara | Merdeka Copper vs. Tower Bersama Infrastructure | Merdeka Copper vs. Pabrik Kertas Tjiwi | Merdeka Copper vs. Mitra Keluarga Karyasehat |
| Multi Indocitra vs. Lautan Luas Tbk | Multi Indocitra vs. Pembangunan Jaya Ancol | Multi Indocitra vs. Modern Internasional Tbk | Multi Indocitra vs. Mustika Ratu Tbk |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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