Correlation Between Modernland Realty and PT Winner
Can any of the company-specific risk be diversified away by investing in both Modernland Realty and PT Winner 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 Modernland Realty and PT Winner into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Modernland Realty Ltd and PT Winner Nusantara, you can compare the effects of market volatilities on Modernland Realty and PT Winner 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 Modernland Realty with a short position of PT Winner. Check out your portfolio center. Please also check ongoing floating volatility patterns of Modernland Realty and PT Winner.
Diversification Opportunities for Modernland Realty and PT Winner
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Modernland and WINR is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Modernland Realty Ltd and PT Winner Nusantara in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PT Winner Nusantara and Modernland Realty 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 Modernland Realty Ltd are associated (or correlated) with PT Winner. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PT Winner Nusantara has no effect on the direction of Modernland Realty i.e., Modernland Realty and PT Winner go up and down completely randomly.
Pair Corralation between Modernland Realty and PT Winner
Assuming the 90 days trading horizon Modernland Realty is expected to generate 4.42 times less return on investment than PT Winner. But when comparing it to its historical volatility, Modernland Realty Ltd is 2.26 times less risky than PT Winner. It trades about 0.03 of its potential returns per unit of risk. PT Winner Nusantara is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,200 in PT Winner Nusantara on September 1, 2024 and sell it today you would earn a total of 200.00 from holding PT Winner Nusantara or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Modernland Realty Ltd vs. PT Winner Nusantara
Performance |
| Timeline |
| Modernland Realty |
| PT Winner Nusantara |
Modernland Realty and PT Winner Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Modernland Realty and PT Winner
The main advantage of trading using opposite Modernland Realty and PT Winner positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Modernland Realty position performs unexpectedly, PT Winner 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 PT Winner will offset losses from the drop in PT Winner's long position.| Modernland Realty vs. Lippo Cikarang Tbk | Modernland Realty vs. Lippo Karawaci Tbk | Modernland Realty vs. Mitra Pinasthika Mustika | Modernland Realty vs. Jakarta Int Hotels |
| PT Winner vs. Pollux Properti Indonesia | PT Winner vs. Jaya Sukses Makmur | PT Winner vs. Natura City Developments | PT Winner vs. Maha Properti Indonesia |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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