Correlation Between Merdeka Copper and Tempo Inti
Can any of the company-specific risk be diversified away by investing in both Merdeka Copper and Tempo Inti 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 Tempo Inti 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 Tempo Inti Media, you can compare the effects of market volatilities on Merdeka Copper and Tempo Inti 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 Tempo Inti. Check out your portfolio center. Please also check ongoing floating volatility patterns of Merdeka Copper and Tempo Inti.
Diversification Opportunities for Merdeka Copper and Tempo Inti
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Merdeka and Tempo is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Merdeka Copper Gold and Tempo Inti Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tempo Inti Media 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 Tempo Inti. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tempo Inti Media has no effect on the direction of Merdeka Copper i.e., Merdeka Copper and Tempo Inti go up and down completely randomly.
Pair Corralation between Merdeka Copper and Tempo Inti
Assuming the 90 days trading horizon Merdeka Copper Gold is expected to under-perform the Tempo Inti. But the stock apears to be less risky and, when comparing its historical volatility, Merdeka Copper Gold is 1.96 times less risky than Tempo Inti. The stock trades about -0.03 of its potential returns per unit of risk. The Tempo Inti Media is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 12,600 in Tempo Inti Media on November 27, 2024 and sell it today you would earn a total of 1,900 from holding Tempo Inti Media or generate 15.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Merdeka Copper Gold vs. Tempo Inti Media
Performance |
| Timeline |
| Merdeka Copper Gold |
| Tempo Inti Media |
Merdeka Copper and Tempo Inti Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Merdeka Copper and Tempo Inti
The main advantage of trading using opposite Merdeka Copper and Tempo Inti positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Merdeka Copper position performs unexpectedly, Tempo Inti 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 Tempo Inti will offset losses from the drop in Tempo Inti'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 |
| Tempo Inti vs. Wicaksana Overseas International | Tempo Inti vs. Wahana Pronatural | Tempo Inti vs. Tigaraksa Satria Tbk | Tempo Inti vs. Millennium Pharmacon International |
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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