Correlation Between Mandala Multifinance and Geoprima Solusi
Can any of the company-specific risk be diversified away by investing in both Mandala Multifinance and Geoprima Solusi 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 Mandala Multifinance and Geoprima Solusi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mandala Multifinance Tbk and Geoprima Solusi Tbk, you can compare the effects of market volatilities on Mandala Multifinance and Geoprima Solusi 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 Mandala Multifinance with a short position of Geoprima Solusi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mandala Multifinance and Geoprima Solusi.
Diversification Opportunities for Mandala Multifinance and Geoprima Solusi
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mandala and Geoprima is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Mandala Multifinance Tbk and Geoprima Solusi Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Geoprima Solusi Tbk and Mandala Multifinance 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 Mandala Multifinance Tbk are associated (or correlated) with Geoprima Solusi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Geoprima Solusi Tbk has no effect on the direction of Mandala Multifinance i.e., Mandala Multifinance and Geoprima Solusi go up and down completely randomly.
Pair Corralation between Mandala Multifinance and Geoprima Solusi
If you would invest 19,300 in Geoprima Solusi Tbk on September 1, 2024 and sell it today you would earn a total of 16,300 from holding Geoprima Solusi Tbk or generate 84.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Mandala Multifinance Tbk vs. Geoprima Solusi Tbk
Performance |
| Timeline |
| Mandala Multifinance Tbk |
| Geoprima Solusi Tbk |
Mandala Multifinance and Geoprima Solusi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mandala Multifinance and Geoprima Solusi
The main advantage of trading using opposite Mandala Multifinance and Geoprima Solusi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mandala Multifinance position performs unexpectedly, Geoprima Solusi 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 Geoprima Solusi will offset losses from the drop in Geoprima Solusi's long position.| Mandala Multifinance vs. Bank BRISyariah Tbk | Mandala Multifinance vs. Ace Hardware Indonesia | Mandala Multifinance vs. Merdeka Copper Gold | Mandala Multifinance vs. Mitra Pinasthika Mustika |
| Geoprima Solusi vs. Integra Indocabinet Tbk | Geoprima Solusi vs. Multistrada Arah Sarana | Geoprima Solusi vs. PT MNC Energy | Geoprima Solusi vs. J Resources Asia |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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