Correlation Between Multifiling Mitra and Global Sukses
Can any of the company-specific risk be diversified away by investing in both Multifiling Mitra and Global Sukses 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 Global Sukses 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 Global Sukses Solusi, you can compare the effects of market volatilities on Multifiling Mitra and Global Sukses 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 Global Sukses. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multifiling Mitra and Global Sukses.
Diversification Opportunities for Multifiling Mitra and Global Sukses
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Multifiling and Global is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Multifiling Mitra Indonesia and Global Sukses Solusi in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Sukses Solusi 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 Global Sukses. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Sukses Solusi has no effect on the direction of Multifiling Mitra i.e., Multifiling Mitra and Global Sukses go up and down completely randomly.
Pair Corralation between Multifiling Mitra and Global Sukses
Assuming the 90 days trading horizon Multifiling Mitra is expected to generate 1.59 times less return on investment than Global Sukses. But when comparing it to its historical volatility, Multifiling Mitra Indonesia is 1.02 times less risky than Global Sukses. It trades about 0.1 of its potential returns per unit of risk. Global Sukses Solusi is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 5,800 in Global Sukses Solusi on August 30, 2024 and sell it today you would earn a total of 1,700 from holding Global Sukses Solusi or generate 29.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multifiling Mitra Indonesia vs. Global Sukses Solusi
Performance |
| Timeline |
| Multifiling Mitra |
| Global Sukses Solusi |
Multifiling Mitra and Global Sukses Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multifiling Mitra and Global Sukses
The main advantage of trading using opposite Multifiling Mitra and Global Sukses positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multifiling Mitra position performs unexpectedly, Global Sukses 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 Global Sukses will offset losses from the drop in Global Sukses' long position.| Multifiling Mitra vs. Midi Utama Indonesia | Multifiling Mitra vs. Jasuindo Tiga Perkasa | Multifiling Mitra vs. Multi Indocitra Tbk | Multifiling Mitra vs. Kokoh Inti Arebama |
| Global Sukses vs. Trimegah Karya Pratama | Global Sukses vs. Surya Biru Murni | Global Sukses vs. Indo Oil Perkasa | Global Sukses vs. Wira Global Solusi |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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