Correlation Between Multi Indocitra and Inter Delta
Can any of the company-specific risk be diversified away by investing in both Multi Indocitra and Inter Delta 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 Multi Indocitra and Inter Delta into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multi Indocitra Tbk and Inter Delta Tbk, you can compare the effects of market volatilities on Multi Indocitra and Inter Delta 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 Multi Indocitra with a short position of Inter Delta. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multi Indocitra and Inter Delta.
Diversification Opportunities for Multi Indocitra and Inter Delta
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Multi and Inter is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Multi Indocitra Tbk and Inter Delta Tbk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inter Delta Tbk and Multi Indocitra 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 Multi Indocitra Tbk are associated (or correlated) with Inter Delta. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inter Delta Tbk has no effect on the direction of Multi Indocitra i.e., Multi Indocitra and Inter Delta go up and down completely randomly.
Pair Corralation between Multi Indocitra and Inter Delta
Assuming the 90 days trading horizon Multi Indocitra is expected to generate 8.32 times less return on investment than Inter Delta. But when comparing it to its historical volatility, Multi Indocitra Tbk is 6.14 times less risky than Inter Delta. It trades about 0.08 of its potential returns per unit of risk. Inter Delta Tbk is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 19,800 in Inter Delta Tbk on August 27, 2024 and sell it today you would earn a total of 2,000 from holding Inter Delta Tbk or generate 10.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multi Indocitra Tbk vs. Inter Delta Tbk
Performance |
| Timeline |
| Multi Indocitra Tbk |
| Inter Delta Tbk |
Multi Indocitra and Inter Delta Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multi Indocitra and Inter Delta
The main advantage of trading using opposite Multi Indocitra and Inter Delta positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multi Indocitra position performs unexpectedly, Inter Delta 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 Inter Delta will offset losses from the drop in Inter Delta's long position.| Multi Indocitra vs. Lautan Luas Tbk | Multi Indocitra vs. Pembangunan Jaya Ancol | Multi Indocitra vs. Modern Internasional Tbk | Multi Indocitra vs. Mustika Ratu Tbk |
| Inter Delta vs. Intraco Penta Tbk | Inter Delta vs. Jakarta Setiabudi Internasional | Inter Delta vs. Perdana Bangun Pusaka | Inter Delta vs. Gema Grahasarana 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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