Correlation Between Mitra Pinasthika and Dharma Satya
Can any of the company-specific risk be diversified away by investing in both Mitra Pinasthika and Dharma Satya 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 Mitra Pinasthika and Dharma Satya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mitra Pinasthika Mustika and Dharma Satya Nusantara, you can compare the effects of market volatilities on Mitra Pinasthika and Dharma Satya 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 Mitra Pinasthika with a short position of Dharma Satya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mitra Pinasthika and Dharma Satya.
Diversification Opportunities for Mitra Pinasthika and Dharma Satya
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Mitra and Dharma is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Mitra Pinasthika Mustika and Dharma Satya Nusantara in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dharma Satya Nusantara and Mitra Pinasthika 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 Mitra Pinasthika Mustika are associated (or correlated) with Dharma Satya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dharma Satya Nusantara has no effect on the direction of Mitra Pinasthika i.e., Mitra Pinasthika and Dharma Satya go up and down completely randomly.
Pair Corralation between Mitra Pinasthika and Dharma Satya
Assuming the 90 days trading horizon Mitra Pinasthika is expected to generate 6.18 times less return on investment than Dharma Satya. But when comparing it to its historical volatility, Mitra Pinasthika Mustika is 2.03 times less risky than Dharma Satya. It trades about 0.02 of its potential returns per unit of risk. Dharma Satya Nusantara is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 56,708 in Dharma Satya Nusantara on September 3, 2024 and sell it today you would earn a total of 56,792 from holding Dharma Satya Nusantara or generate 100.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mitra Pinasthika Mustika vs. Dharma Satya Nusantara
Performance |
| Timeline |
| Mitra Pinasthika Mustika |
| Dharma Satya Nusantara |
Mitra Pinasthika and Dharma Satya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mitra Pinasthika and Dharma Satya
The main advantage of trading using opposite Mitra Pinasthika and Dharma Satya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mitra Pinasthika position performs unexpectedly, Dharma Satya 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 Dharma Satya will offset losses from the drop in Dharma Satya's long position.| Mitra Pinasthika vs. Saratoga Investama Sedaya | Mitra Pinasthika vs. Puradelta Lestari PT | Mitra Pinasthika vs. Cikarang Listrindo Tbk | Mitra Pinasthika vs. Erajaya Swasembada Tbk |
| Dharma Satya vs. Salim Ivomas Pratama | Dharma Satya vs. Sawit Sumbermas Sarana | Dharma Satya vs. Austindo Nusantara Jaya | Dharma Satya vs. Eagle High Plantations |
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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