Correlation Between Multifiling Mitra and Hero Supermarket
Can any of the company-specific risk be diversified away by investing in both Multifiling Mitra and Hero Supermarket 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 Multifiling Mitra and Hero Supermarket into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multifiling Mitra Indonesia and Hero Supermarket Tbk, you can compare the effects of market volatilities on Multifiling Mitra and Hero Supermarket 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 Multifiling Mitra with a short position of Hero Supermarket. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multifiling Mitra and Hero Supermarket.
Diversification Opportunities for Multifiling Mitra and Hero Supermarket
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Multifiling and Hero is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Multifiling Mitra Indonesia and Hero Supermarket Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hero Supermarket Tbk and Multifiling Mitra 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 Multifiling Mitra Indonesia are associated (or correlated) with Hero Supermarket. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hero Supermarket Tbk has no effect on the direction of Multifiling Mitra i.e., Multifiling Mitra and Hero Supermarket go up and down completely randomly.
Pair Corralation between Multifiling Mitra and Hero Supermarket
Assuming the 90 days trading horizon Multifiling Mitra Indonesia is expected to generate 1.05 times more return on investment than Hero Supermarket. However, Multifiling Mitra is 1.05 times more volatile than Hero Supermarket Tbk. It trades about 0.1 of its potential returns per unit of risk. Hero Supermarket Tbk is currently generating about -0.33 per unit of risk. If you would invest 120,000 in Multifiling Mitra Indonesia on September 1, 2024 and sell it today you would earn a total of 5,000 from holding Multifiling Mitra Indonesia or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multifiling Mitra Indonesia vs. Hero Supermarket Tbk
Performance |
| Timeline |
| Multifiling Mitra |
| Hero Supermarket Tbk |
Multifiling Mitra and Hero Supermarket Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multifiling Mitra and Hero Supermarket
The main advantage of trading using opposite Multifiling Mitra and Hero Supermarket positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multifiling Mitra position performs unexpectedly, Hero Supermarket 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 Hero Supermarket will offset losses from the drop in Hero Supermarket's long position.| Multifiling Mitra vs. Matahari Department Store | Multifiling Mitra vs. Multi Medika Internasional | Multifiling Mitra vs. Visi Media Asia | Multifiling Mitra vs. Bayan Resources Tbk |
| Hero Supermarket vs. Bank BRISyariah Tbk | Hero Supermarket vs. Mitra Pinasthika Mustika | Hero Supermarket vs. Jakarta Int Hotels | Hero Supermarket vs. Indosterling Technomedia 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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