Correlation Between Multifiling Mitra and Matahari Department
Can any of the company-specific risk be diversified away by investing in both Multifiling Mitra and Matahari Department 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 Matahari Department 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 Matahari Department Store, you can compare the effects of market volatilities on Multifiling Mitra and Matahari Department 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 Matahari Department. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multifiling Mitra and Matahari Department.
Diversification Opportunities for Multifiling Mitra and Matahari Department
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Multifiling and Matahari is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Multifiling Mitra Indonesia and Matahari Department Store in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matahari Department Store 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 Matahari Department. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matahari Department Store has no effect on the direction of Multifiling Mitra i.e., Multifiling Mitra and Matahari Department go up and down completely randomly.
Pair Corralation between Multifiling Mitra and Matahari Department
Assuming the 90 days trading horizon Multifiling Mitra Indonesia is expected to generate 1.85 times more return on investment than Matahari Department. However, Multifiling Mitra is 1.85 times more volatile than Matahari Department Store. It trades about 0.2 of its potential returns per unit of risk. Matahari Department Store is currently generating about -0.04 per unit of risk. If you would invest 44,649 in Multifiling Mitra Indonesia on September 3, 2024 and sell it today you would earn a total of 80,351 from holding Multifiling Mitra Indonesia or generate 179.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.36% |
| Values | Daily Returns |
Multifiling Mitra Indonesia vs. Matahari Department Store
Performance |
| Timeline |
| Multifiling Mitra |
| Matahari Department Store |
Multifiling Mitra and Matahari Department Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multifiling Mitra and Matahari Department
The main advantage of trading using opposite Multifiling Mitra and Matahari Department positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multifiling Mitra position performs unexpectedly, Matahari Department 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 Matahari Department will offset losses from the drop in Matahari Department's long position.| Multifiling Mitra vs. Intanwijaya Internasional Tbk | Multifiling Mitra vs. Champion Pacific Indonesia | Multifiling Mitra vs. Mitra Pinasthika Mustika | Multifiling Mitra vs. Jakarta Int Hotels |
| Matahari Department vs. Surya Citra Media | Matahari Department vs. Akr Corporindo Tbk | Matahari Department vs. Media Nusantara Citra | Matahari Department vs. Pembangunan Perumahan PT |
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 CEOs Directory module to screen CEOs from public companies around the world.
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