Correlation Between Media Nusantara and Energi Mega
Can any of the company-specific risk be diversified away by investing in both Media Nusantara and Energi Mega 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 Energi Mega 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 Energi Mega Persada, you can compare the effects of market volatilities on Media Nusantara and Energi Mega 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 Energi Mega. Check out your portfolio center. Please also check ongoing floating volatility patterns of Media Nusantara and Energi Mega.
Diversification Opportunities for Media Nusantara and Energi Mega
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Media and Energi is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Media Nusantara Citra and Energi Mega Persada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energi Mega Persada 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 Energi Mega. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energi Mega Persada has no effect on the direction of Media Nusantara i.e., Media Nusantara and Energi Mega go up and down completely randomly.
Pair Corralation between Media Nusantara and Energi Mega
Assuming the 90 days trading horizon Media Nusantara Citra is expected to generate 0.54 times more return on investment than Energi Mega. However, Media Nusantara Citra is 1.84 times less risky than Energi Mega. It trades about -0.14 of its potential returns per unit of risk. Energi Mega Persada is currently generating about -0.08 per unit of risk. If you would invest 32,800 in Media Nusantara Citra on August 25, 2024 and sell it today you would lose (2,400) from holding Media Nusantara Citra or give up 7.32% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Media Nusantara Citra vs. Energi Mega Persada
Performance |
| Timeline |
| Media Nusantara Citra |
| Energi Mega Persada |
Media Nusantara and Energi Mega Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Media Nusantara and Energi Mega
The main advantage of trading using opposite Media Nusantara and Energi Mega positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Media Nusantara position performs unexpectedly, Energi Mega 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 Energi Mega will offset losses from the drop in Energi Mega's long position.| Media Nusantara vs. Mnc Land Tbk | Media Nusantara vs. MNC Vision Networks | Media Nusantara vs. MD Pictures Tbk | Media Nusantara vs. Link Net Tbk |
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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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