Correlation Between Media Nusantara and Era Media
Can any of the company-specific risk be diversified away by investing in both Media Nusantara and Era Media 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 Media Nusantara and Era Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Media Nusantara Citra and Era Media Sejahtera, you can compare the effects of market volatilities on Media Nusantara and Era Media 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 Media Nusantara with a short position of Era Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Media Nusantara and Era Media.
Diversification Opportunities for Media Nusantara and Era Media
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Media and Era is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Media Nusantara Citra and Era Media Sejahtera in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Era Media Sejahtera and Media Nusantara 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 Media Nusantara Citra are associated (or correlated) with Era Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Era Media Sejahtera has no effect on the direction of Media Nusantara i.e., Media Nusantara and Era Media go up and down completely randomly.
Pair Corralation between Media Nusantara and Era Media
Assuming the 90 days trading horizon Media Nusantara Citra is expected to generate 0.29 times more return on investment than Era Media. However, Media Nusantara Citra is 3.5 times less risky than Era Media. It trades about -0.43 of its potential returns per unit of risk. Era Media Sejahtera is currently generating about -0.14 per unit of risk. If you would invest 28,200 in Media Nusantara Citra on November 28, 2024 and sell it today you would lose (3,800) from holding Media Nusantara Citra or give up 13.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Media Nusantara Citra vs. Era Media Sejahtera
Performance |
| Timeline |
| Media Nusantara Citra |
| Era Media Sejahtera |
Media Nusantara and Era Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Media Nusantara and Era Media
The main advantage of trading using opposite Media Nusantara and Era Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Media Nusantara position performs unexpectedly, Era Media 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 Era Media will offset losses from the drop in Era Media's long position.| Media Nusantara vs. Global Mediacom Tbk | Media Nusantara vs. Surya Citra Media | Media Nusantara vs. Akr Corporindo Tbk | Media Nusantara vs. Bumi Serpong Damai |
| Era Media vs. Bank Central Asia | Era Media vs. Bank Rakyat Indonesia | Era Media vs. Bayan Resources Tbk | Era Media vs. Bank Mandiri Persero |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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