Correlation Between Multi Medika and Wijaya Karya
Can any of the company-specific risk be diversified away by investing in both Multi Medika and Wijaya Karya 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 Medika and Wijaya Karya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multi Medika Internasional and Wijaya Karya Bangunan, you can compare the effects of market volatilities on Multi Medika and Wijaya Karya 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 Medika with a short position of Wijaya Karya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multi Medika and Wijaya Karya.
Diversification Opportunities for Multi Medika and Wijaya Karya
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Multi and Wijaya is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Multi Medika Internasional and Wijaya Karya Bangunan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wijaya Karya Bangunan and Multi Medika 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 Medika Internasional are associated (or correlated) with Wijaya Karya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wijaya Karya Bangunan has no effect on the direction of Multi Medika i.e., Multi Medika and Wijaya Karya go up and down completely randomly.
Pair Corralation between Multi Medika and Wijaya Karya
Assuming the 90 days trading horizon Multi Medika Internasional is expected to under-perform the Wijaya Karya. In addition to that, Multi Medika is 1.86 times more volatile than Wijaya Karya Bangunan. It trades about -0.02 of its total potential returns per unit of risk. Wijaya Karya Bangunan is currently generating about -0.04 per unit of volatility. If you would invest 15,100 in Wijaya Karya Bangunan on September 3, 2024 and sell it today you would lose (7,700) from holding Wijaya Karya Bangunan or give up 50.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multi Medika Internasional vs. Wijaya Karya Bangunan
Performance |
| Timeline |
| Multi Medika Interna |
| Wijaya Karya Bangunan |
Multi Medika and Wijaya Karya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multi Medika and Wijaya Karya
The main advantage of trading using opposite Multi Medika and Wijaya Karya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multi Medika position performs unexpectedly, Wijaya Karya 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 Wijaya Karya will offset losses from the drop in Wijaya Karya's long position.| Multi Medika vs. Indo Acidatama Tbk | Multi Medika vs. PT Boston Furniture | Multi Medika vs. Global Mediacom Tbk | Multi Medika vs. First Media Tbk |
| Wijaya Karya vs. Intanwijaya Internasional Tbk | Wijaya Karya vs. Champion Pacific Indonesia | Wijaya Karya vs. Mitra Pinasthika Mustika | Wijaya Karya vs. Jakarta Int Hotels |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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