Correlation Between Multi Indocitra and Multi Bintang
Can any of the company-specific risk be diversified away by investing in both Multi Indocitra and Multi Bintang 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 Multi Bintang 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 Multi Bintang Indonesia, you can compare the effects of market volatilities on Multi Indocitra and Multi Bintang 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 Multi Bintang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multi Indocitra and Multi Bintang.
Diversification Opportunities for Multi Indocitra and Multi Bintang
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Multi and Multi is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Multi Indocitra Tbk and Multi Bintang Indonesia in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Multi Bintang Indonesia 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 Multi Bintang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Multi Bintang Indonesia has no effect on the direction of Multi Indocitra i.e., Multi Indocitra and Multi Bintang go up and down completely randomly.
Pair Corralation between Multi Indocitra and Multi Bintang
Assuming the 90 days trading horizon Multi Indocitra is expected to generate 16.48 times less return on investment than Multi Bintang. But when comparing it to its historical volatility, Multi Indocitra Tbk is 1.54 times less risky than Multi Bintang. It trades about 0.0 of its potential returns per unit of risk. Multi Bintang Indonesia is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 607,500 in Multi Bintang Indonesia on November 29, 2024 and sell it today you would earn a total of 5,000 from holding Multi Bintang Indonesia or generate 0.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multi Indocitra Tbk vs. Multi Bintang Indonesia
Performance |
| Timeline |
| Multi Indocitra Tbk |
| Multi Bintang Indonesia |
Multi Indocitra and Multi Bintang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multi Indocitra and Multi Bintang
The main advantage of trading using opposite Multi Indocitra and Multi Bintang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multi Indocitra position performs unexpectedly, Multi Bintang 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 Multi Bintang will offset losses from the drop in Multi Bintang'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 |
| Multi Bintang vs. Delta Djakarta Tbk | Multi Bintang vs. Merck Tbk | Multi Bintang vs. Mayora Indah Tbk | Multi Bintang vs. Ultra Jaya Milk |
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.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |